Paridhi Jain

Certified Public Accountant

Paridhi Jain is a Certified Public Accountant and the Co-Founder of Seva Ltd, a CPA firm operating in Maryland and Alabama. She has over 10 years of professional experience in the financial sector and has built a reputation for assisting small business owners navigate the intricacies of regulatory compliance, encompassing areas from company structuring and entity formation to detailed nexus determinations for income and sales tax. She is an active member of the Alabama Society of CPAs and has a certification in pre-professional accounting. She graduated Magna Cum Laude from the University of Maryland, Baltimore County with a major in Information Systems.

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Q&A Comments (8)

How do I calculate a daily simple interest rate?
A good example is if you have $100 and you've mentioned a daily interest rate. Assuming an annual interest rate of 10% on a loan of $100, it means you agree to pay back $110 at the end of the year. Now, if we're dealing with daily compounding, the daily interest would be calculated as 10% divided by 365 days in a year. This equates to approximately 0.027%, or around 2.7 cents per day. Over the course of a year, this adds up to $10 in interest. So, on a daily basis, you're looking at about 0.027% interest.
What is compound annual growth rate, and how do I calculate it?
Let's delve into the compound annual growth rate (CAGR). Instead of being the borrower, envision yourself as the lender, like a bank investing $100 in someone. Anticipating a return of $110 by the year's end, on December 31, you have $110. The following day, your 10% return is not just on the original $100 but on the new total of $110. This compounding effect unfolds annually, meaning in the second year, you're not just earning 10% on the initial $100; it's 10% on the new amount, resulting in $11. This progression represents the annual growth of your money.
Can you give an example of computing a daily simple interest rate?
A good example is if you have $100 and you've mentioned a daily interest rate. Assuming an annual interest rate of 10% on a loan of $100, it means you agree to pay back $110 at the end of the year. Now, if we're dealing with daily compounding, the daily interest would be calculated as 10% divided by 365 days in a year. This equates to approximately 0.027%, or around 2.7 cents per day. Over the course of a year, this adds up to $10 in interest. So, on a daily basis, you're looking at about 0.027% interest.
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