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1. What is the annual payment (round to the nearest $)? 2. What are the total interest payments (round to the nearest $)? 2$ 3. After 34 payments have been made, what percentage of the total Interest has been paid (round to the nearest percentage point)?

1. What is the annual payment (round to the nearest $)? 2. What are the total interest payments (round to the nearest $)? 2$ 3. After 34 payments have been made, what percentage of the total Interest has been paid (round to the nearest percentage point)?

Cornerstones of Financial Accounting
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter9: Long-term Liabilities
Section: Chapter Questions
Problem 85E: ExerciseInstallment Notes ABC bank loans $250,000 to Yossarian to purchase a new home. Yossarian...
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This is a loan problem with multiple parts please read and answer questions carefully.

You borrow money on a self liquidating installment loan (equal payments at the end of each year, each payment is part principal part interest) $319,000 16.1% 54 years Loan amount Interest Rate Life Date of Loan January 1, 2021 Use the installment method - not straight line Do NOT round any interrmediate numbers. Do NOT turn this into a monthly problem. Do NOT put in minus signs, answer all positive numbers. Required: 1. What is the annual payment (round to the nearest $)? 24 2. What are the total interest payments (round to the nearest $)? 3. After 34 payments have been made, what percentage of the total interest has been paid (round to the nearest percentage point)? 4. After 34 payments have been made, what percentage of the total principal has been paid (round to the nearest percentage point)?
Transcribed Image Text:You borrow money on a self liquidating installment loan (equal payments at the end of each year, each payment is part principal part interest) $319,000 16.1% 54 years Loan amount Interest Rate Life Date of Loan January 1, 2021 Use the installment method - not straight line Do NOT round any interrmediate numbers. Do NOT turn this into a monthly problem. Do NOT put in minus signs, answer all positive numbers. Required: 1. What is the annual payment (round to the nearest $)? 24 2. What are the total interest payments (round to the nearest $)? 3. After 34 payments have been made, what percentage of the total interest has been paid (round to the nearest percentage point)? 4. After 34 payments have been made, what percentage of the total principal has been paid (round to the nearest percentage point)?
Redo the problem if the interest rate is 2% (for a well designed spreadsheet this should take 30 seconds) Required: 5. What is the annual payment (round to the nearest $)? 6. What are the total interest payments (round to the nearest $)? 7. After 34 payments have been made, what percentage of the total interest has been paid (round to the nearest percentage point)? 8. After 34 payments have been made, what percentage of the total principal has been paid (round to the nearest percentage point)?
Transcribed Image Text:Redo the problem if the interest rate is 2% (for a well designed spreadsheet this should take 30 seconds) Required: 5. What is the annual payment (round to the nearest $)? 6. What are the total interest payments (round to the nearest $)? 7. After 34 payments have been made, what percentage of the total interest has been paid (round to the nearest percentage point)? 8. After 34 payments have been made, what percentage of the total principal has been paid (round to the nearest percentage point)?
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