Ahmad borrowed $15,000 now and it is to be repaid by equal end-of-quarter installments for 5 years with interest at 8% compounded quarterly. What is the amount of each payment? Select one: a. $917.4 per quarter b. $617.4 per quarter c. $717.4 per quarter d. $1617.4 per quarter

Ahmad borrowed $15,000 now and it is to be repaid by equal end-of-quarter installments for 5 years with interest at 8% compounded quarterly. What is the amount of each payment? Select one: a. $917.4 per quarter b. $617.4 per quarter c. $717.4 per quarter d. $1617.4 per quarter

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 1EA: Halep Inc. borrowed $30,000 from Davis Bank and signed a 4-year note payable stating the interest...

See similar textbooks

Related questions

Q: iii) Someone borrows $ 45,000 at a rate of 20% per annum and after one year begins to pay annual…

A: Loan amount (PV) = $ 45,000 Annual interest rate (r) = 20% Number of annual payments (n) = 5

Q: Today, a businessman borrowed money to be paid in 10 equal quarterly payments starting at the end 2…

A: The amount borrowed can be calculated as the present value of quarterly payments, The present value…

Q: The owner of Oak Hill Squirrel Farm deposits $2,000 at the end of each quarter into an account…

A: In the given question we need to compute the future value after 9 years, 6 months.

Q: Starting three years from today, you make equal annual deposits of $5,000 into an account which…

A: Effective annual rate is calculated using the formula: EAR=1+rmm-1=1+12%22-1=1.062-1=12.36%

Q: You agreed to make equal payments of 28,191 at the beginning of each months to discharge a debt due…

Q: Adrian borrowed $2,000 for 4 years For the first 15 years, the interest rate on the loan was 8%…

Q: Suntech Distributors, Inc., deposits $4,000 at the beginning of each 3-month period for 7 years in…

A: Formula: A = P [ 1 + ( r / N )NT ] Interest : Interest is a fee charged on the borrowed amount.

Q: You borrow $5,000 at 10% per year and will pay off the loan in 3 equal annual payments starting 1…

A: Principal = 5000 r = 10% period = 3 years after 1 year of taking loan payments = 2010.57 This annual…

Q: You have borrowed $28,000 at an interest rate of 12% compounded annually. Equal payments will be…

A: Given, Amount borrowed = $28000 Interest Rate = 12% No. of years = 4

Q: Richard borrowed P50,000 as a loan, with an interest of 6% per year, compounded quarterly payable in…

A: Present value of annuity concept is used to calculate quarterly payments.

Q: Tony is converting an RRSP balance of $275,000.00 into a RRIF. Tony wants to receive $1,911.00 at…

A: Time value tells that money received today is of more value than that of receiving the same value…

Q: Kiara deposited $1,000 at the end of every month into an RRSP for 8 years. The interest rate earned…

A: We need to use future value of ordinary annuity formula to calculate accumulated value. Future…

Q: An individual borrows ₱150,000 from a bank at 10% annually compounded interest to be repaid in 6…

A: Loan can be amortized by repaying it in equal instalments. Each payment comprises of both interest…

Q: You borrow $10,000 at 14 percent compound annual interest for four years. The loan is repayable in…

A: Loan Amount = 10,000 Interest Rate = 14% Annual Compounding Time Period = 4 years End of year…

Q: Nelson took out a 25-year home loan of $500,000. He made equal month-end repayments at the interest…

A: Note: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question…

Q: Parker borrowed $283,000 at 7.5% compounded quarterly to finance the purchase of a pizza franchise.…

A: Given: Borrowed = $283,000 Interest rate = 7.5% Compounding quarterly Years = 10

Q: You have taken a loan of $76,000.00 for 22 years at 5.2% compounded quarterly 1st-3rd month…

A: Payment refers to the periodic payments which are made in lieu of repayment of a loan. Payment…

Q: -A debt requires payments of $750 at the end of every three months for 8 years. Calculate the…

A: Interest charged on Debt: Interest is applied to practically all debts, and additional costs are…

Q: A man loans 192,000 and promised to pay for 8 years at an interest rate of 5% compounded annually,…

A: Annual payment can be calculated by using the formula of the present value of annuity. Present…

Q: An amount of 100,000 was borrowed and was to be repaid in 10 instalments at the end of every quarter…

A: Here, Borrowed amount (PV) is 100,000 No. of Quarterly Payment (n) is 10 Uniform Gradient Amount (G)…

Q: How much in each of the quarterly installments if rate of interest 10% compounded bi-monthly?

A: A stream of equal cash flows paid or received periodically is termed as annuity. Annuity is either…

Q: How much will be owed at the end of 5 years?

A: Time value of money means the amount of received in the present period will have more value than…

Q: MARIA LOANED AN AMOUNT OF P100,00.00 PAYABLE IN 15 EQUAL QUARTERLY INSTALLMENTS THE FIRST PAYMENT…

A: Loan Amount = P100,000 Time Period = 15 Quarters Interest Rate = 10% compounded bi-monthly

Q: Bill Mitselfik borrowed $10,000 to be repaid in quarterly installments over the next five years. The…

Q: Mr. J. Dela Cruz borrowed money from a bank and he receives P1,340.00 and promised to pay P1,500 at…

A: Note: The question provided are two separate ones. In the first one, I have calculated both the…

Q: Nelson took out a 25-year home loan of $500,000. He made equal month-end repayments at the interest…

A: A loan is an amount that is borrowed from a bank or any other party. Loans are used by individuals…

Q: John Johnson borrowed $15,550 from a bank for three years. If the quoted rate (APR) is 5.20 percent,…

A: In the given question we need to compute the effective annual interest rate (EAR) if the nominal…

Q: Kingsley Toyota borrowed $100,000 from a local bank. The loan requires Kingsley to pay 10 equal…

A: Step 1: Compute the present value of an ordinary annuity of $1.

Q: Saud borrowed $90,000 now. He will pay off the loan with 10 equal quarterly payments. The first…

A: To find the quarterly payment one can apply the formula in excel called PMT which calculates the…

Q: Marshall recently obtained a 5-year, $50,000 loan. The loan carries 10 percent compound annual…

A: The payments discussed here are a form of annuity wherein an equal payment is made each period.

Q: Tedros borrowed $2 million and planned to repay the loan by making equal month-end payments over a…

A: Time value of money(TVM) means that the money received today will be worth more than the amount of…

Q: Tedros borrowed $2 million and planned to repay the loan by making equal month-end payments over a…

A: Since you have posted a question with multiple sub-parts, we will solve the first three subparts for…

Q: A loan of $20,000 has a stated interest rate of 5 percent per year. Repayment of principal and all…

A: Loan amount = $20,000 Interest rate = 5% Time period = 10 years

Q: Jack has borrowed $1,000,000 from MQ Bank for 10 years at an interest rate of j2=3.11%. He will make…

A: Loan Amount $ 1000,000 Interest rate 3.11% Annual Installment 10

Q: Cameron's student loan of $28,000 at 3.72% compounded quarterly was amortized over 5 years with…

A: We can find the remaining balance on a loan either by creating an amortization table or using a…

Q: The owner of Oak Hill Squirrel Farm deposits $3,000 at the end of each quarter into an account…

A: This question require us to compute the value at the end of 6 years, 6 months from following…

Q: An amount of 100,000 was borrowed and was to be repaid in 10 instalments at the end of every quarter…

A: Given: P= $100,000 r= 12% compounded semi annually = 12%/2 = 6% = 0.06 Number of years= 2.5 years…

Q: Cameron deposited $1,400 at the end of every month into an RRSP for 8 years. The interest rate…

A: As per the given information: Amount deposited at the end of every month into an RRSP for 8 years -…

Q: Liza Ammorante borrow 125,000 per annum to be paid in 5 years time, on equal yearly at 6.735% per…

A: An amortized mortgage is a loan that is paid off in equal periodic installments. The installments…

Q: 1. At the beginning of each quarter, P36,000 is deposited into savings account that pays 6%…

A: Honor code: Since you have asked multiple questions, we will solve the one question for you. If you…

Q: The owner of Oak Hill Squirrel Farm deposits $2,000 at the end of each quarter into an account…

A: Quarterly deposit (P) = $2,000 Interest rate = 1.5% Quarterly interest rate (i) = Interest rate/4 =…

Q: Stan Moneymaker has a bank loan for $10,000 to pay for his new truck. Thisloan is to be repaid in…

A: Each time a person makes a payment on a loan he pays some interest along with a part of the…

Q: Kehoe, Inc. owes $40,000 to Ritter Company. How muchwould Kehoe have to pay each year if the debt is…

A: Present Value Factor for 4 years at 12%:

Q: Tedros borrowed $2 million and planned to repay the loan by making equal month-end payments over a…

Q: The Del Corporation borrowed $9.000,000 at 8% interest per year, which must be repaid in equal EOY…

A: Installment is the amount of periodic payment a borrower has to make to its lender in order to pay…

Q: Ahmad borrowed $15,000 now and it is to be repaid by equal end-of-quarter installments for 5 years…

A: The periodic payment refers to the equivalent annual cost made towards the acquisition of an asset…

Q: A.Halep Inc. borrowed $17,128 from Davis Bank and signed a 2-year note payable stating the interest…

A: Annual payment in case of borrowing can be calculated by: = Amount borrowed / Present Value factor…

Concept explainers

Market Efficiency

Market efficiency refers to the market's ability to provide investors with all available information about investment options for buying and selling securities. Market efficiency reflects the true value of securities without undervaluing or overvaluing them. When the quality and quantity of information increase, the market becomes more efficient, allowing it to reduce arbitrage and obtain higher market returns from investment. In a well-functioning market, everyone receives all information completely and immediately at no cost. It opens up a plethora of opportunities for investors to access various investment options.

Question

Please

Ahmad borrowed $15,000 now and it is to be repaid by equal end-of-quarter installments for 5
years with interest at 8% compounded quarterly. What is the amount of each payment?
Select one:
a. $917.4 per quarter
b. $617.4 per quarter
c. $717.4 per quarter
d. $1617.4 per quarter

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step 3

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps with 2 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

Marathon Peanuts converts a $130,000 account payable into a short-term note payable, with an annual interest rate of 6%, and payable in four months. How much interest will Marathon Peanuts owe at the end of four months? A. $2,600 B. $7,800 C. $137,800 D. $132,600
Halep Inc. borrowed $30,000 from Davis Bank and signed a 4-year note payable stating the interest rate was 4% compounded annually. Halep Inc. will make payments of $8,264.70 at the end of each year. Prepare an amortization table showing the principal and interest in each payment.
Cash Flow Amounts R. Lee Rouse borrows 10,000 that is to be repaid in 24 equal monthly installments payable at the end of each subsequent month with interest at the rate of 1% per month. Required: Using the appropriate table, calculate the equal installments.
Sharapovich Inc. borrowed $50,000 from Kerber Bank and signed a 5-year note payable stating the interest rate was 5% compounded annually. Sharapovich Inc. will make payments of $11,548.74 at the end of each year. Prepare an amortization table showing the principal and interest in each payment.
Calculating and comparing add-on and simple interest loans. Eli Nelson is borrowing 10,000 for five years at 7 percent. Payments, which are made on a monthly basis, are determined using the add-on method. a. How much total interest will Eli pay on the loan if it is held for the full five-year term? b. What are Elis monthly payments? c. How much higher are the monthly payments under the add-on method than under the simple interest method?
Sub-Cinema Inc. borrowed $10,000 on Jan. 1 and will repay the loan with 12 equal payments made at the end of the month for 12 months. The interest rate is 12% annually. If the monthly payments are $888.49, what is the journal entry to record the cash received on Jan. 1 and the first payment made on Jan. 31?
Jain Enterprises honors a short-term note payable. Principal on the note is $425,000, with an annual interest rate of 3.5%, due in 6 months. What journal entry is created when Jain honors the note?