Aman borrows a sum of ₹192208 at the rate of 15% per annum simple interest. At the end of the first year, he repays ₹20196 towards return of principal amount borrowed. If Aman clears all pending dues at the end of the second year, including interest payment that accrued during the first year, how much does he pay (in ₹) at the end of the second year?

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Accepted Answer

Step 1: Calculate the interest for the first year on the full principal.
Interest for 1 year = Principal × Rate × Time / 100 = 192208 × 15 × 1 / 100 = ₹28831.2

Step 2: At the end of the first year, Aman repays ₹20196 towards principal. So, the remaining principal after first year = 192208 - 20196 = ₹172012

Step 3: The interest accrued during the first year (₹28831.2) is still pending and must be paid at the end of the second year.

Step 4: Calculate the interest for the second year on the remaining principal ₹172012.
Interest for 2nd year = 172012 × 15 × 1 / 100 = ₹25801.8

Step 5: At the end of the second year, Aman pays off the remaining principal, the interest accrued during the first year, and the interest for the second year.
Total payment at end of second year = Remaining principal + Interest of first year + Interest of second year
= 172012 + 28831.2 + 25801.8 = ₹226645

Therefore, Aman pays ₹226645 at the end of the second year.

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