Accrued Interest Calculator

Accrued Interest Calculator to calculate the costs of borrowing money. The daily accrued interest calculator will calculate the accrued interest costs, accrued interest rate, and the daily interest cost.

Accrued Interest Formula

Following is the accrued interest formula that shows how to calculate accrued interest.

Accrued Interest Cost = P x R x T
Accrued Interest Rate = R / 365 x T
Daily Interest Cost = Accrued Interest Cost / T, where

P = Principal
R = Annual interest rate
T = Time period

Accrued Interest Example

To illustrate the use of the accrued interest formula, assume that the investment amount is $10,000, with an annual interest rate of 5% and a holding period of 30 days.

Investment Amount: $10,000
Interest Rate: 5%
Holding Period: 30 days

To calculate the accrued interest cost, we apply the accrued interest formula given above

Accrued Interest Cost = P x R x T = $10,000 x 5/100/365 x 30 = $41.10
Accrued Interest Rate = R / 365 x T = 5 / 365 x 30 = 0.411%
Daily Interest Cost = Accrued Interest Cost / T = $41.10 / 30 = $1.37