Chuck Wells is planning to buy a Winnebago motor home. The listed price is $155,000. Chuck can get a secured add-on interest loan from his bank at 7.25% for as long as 60 months if he pays 15% down. Chuck's goal is to keep his payments below $3,600 per month and amortize the loan in 42 months. (a)Find Chuck's monthly payment (in $) with these conditions. (Round your answer to the nearest cent.)$__________ Can he pay off the loan and keep his payments under $3,600? Yes, under these conditions, Chuck will meet his goal. No, the monthly payment is too high. (b)What are Chuck's options to get his payments closer to his goal? (Select all that apply.) try to negotiate a lower interest ratetry to negotiate a higher interest ratetry to bargain for a lower sale price make a lower down payment make a higher down payment try to bargain for a higher sale price (c)Chuck spoke with his bank's loan officer, who has agreed to finance the deal with a 6.95% loan if Chuck can pay 20% down. What will Chuck's new monthly payment (in $) be with these conditions? (Round your answer to the nearest cent.)$_________ With these conditions, will Chuck be able to pay off the loan and meet his goals? Yes or No Yes, under these conditions, Chuck will meet his goal. No, the monthly payment is too high.
Chuck Wells is planning to buy a Winnebago motor home. The listed price is $155,000. Chuck can get a secured add-on interest loan from his bank at 7.25% for as long as 60 months if he pays 15% down. Chuck's goal is to keep his payments below $3,600 per month and amortize the loan in 42 months. (a)Find Chuck's monthly payment (in $) with these conditions. (Round your answer to the nearest cent.)$__________ Can he pay off the loan and keep his payments under $3,600? Yes, under these conditions, Chuck will meet his goal. No, the monthly payment is too high. (b)What are Chuck's options to get his payments closer to his goal? (Select all that apply.) try to negotiate a lower interest ratetry to negotiate a higher interest ratetry to bargain for a lower sale price make a lower down payment make a higher down payment try to bargain for a higher sale price (c)Chuck spoke with his bank's loan officer, who has agreed to finance the deal with a 6.95% loan if Chuck can pay 20% down. What will Chuck's new monthly payment (in $) be with these conditions? (Round your answer to the nearest cent.)$_________ With these conditions, will Chuck be able to pay off the loan and meet his goals? Yes or No Yes, under these conditions, Chuck will meet his goal. No, the monthly payment is too high.
Excel Applications for Accounting Principles
4th Edition
ISBN:9781111581565
Author:Gaylord N. Smith
Publisher:Gaylord N. Smith
ChapterMB: Model-building Problems
Section: Chapter Questions
Problem 27M
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Chuck Wells is planning to buy a Winnebago motor home. The listed price is $155,000. Chuck can get a secured add-on interest loan from his bank at 7.25% for as long as 60 months if he pays 15% down. Chuck's goal is to keep his payments below $3,600 per month and amortize the loan in 42 months.
(a)Find Chuck's monthly payment (in $) with these conditions. (Round your answer to the nearest cent.)$__________
Can he pay off the loan and keep his payments under $3,600?
Yes, under these conditions, Chuck will meet his goal.
No, the monthly payment is too high.
(b)What are Chuck's options to get his payments closer to his goal? (Select all that apply.)
try to negotiate a lower interest ratetry
to negotiate a higher interest ratetry
to bargain for a lower sale price
make a lower down payment
make a higher down payment
try to bargain for a higher sale price
(c)Chuck spoke with his bank's loan officer, who has agreed to finance the deal with a 6.95% loan if Chuck can pay 20% down. What will Chuck's new monthly payment (in $) be with these conditions? (Round your answer to the nearest cent.)$_________
With these conditions, will Chuck be able to pay off the loan and meet his goals?
Yes or No
Yes, under these conditions, Chuck will meet his goal.
No, the monthly payment is too high.
(d)Attempting to reduce his monthly payment further, Chuck continues to negotiate with the seller. If the seller agrees to reduce the listed price by $4,600, finance the deal with a 6.95% loan, and if Chuck pays the 20% down, what will Chuck's monthly payment be (in $)? (Round your answer to the nearest cent.)
$ _________
With these conditions, will Chuck be able to pay off the loan and meet his goal?
Yes or No
Yes, under these conditions, Chuck will meet his goal.
No, the monthly payment is too high.
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