Ms. Ligaya wants to buy her dream car. However, she does not have enough money to pay for ₱5,000,000 full price of the car. She negotiated with the sales agent and paid a down payment of ₱2,000,000 and borrowed ₱3,000,000 from Pure Gold Bank and signed a 4-year note payable stating the interest rate was 4% compounded annually. Ms. Ligaya will make payments of ₱826,470.14 at the end of each year. How much will be the principal amortization on the 2nd payment? (Provide solution/ explanation)
Ms. Ligaya wants to buy her dream car. However, she does not have enough money to pay for ₱5,000,000 full price of the car. She negotiated with the sales agent and paid a down payment of ₱2,000,000 and borrowed ₱3,000,000 from Pure Gold Bank and signed a 4-year note payable stating the interest rate was 4% compounded annually. Ms. Ligaya will make payments of ₱826,470.14 at the end of each year. How much will be the principal amortization on the 2nd payment? (Provide solution/ explanation)
Chapter4: Time Value Of Money
Section: Chapter Questions
Problem 25PROB
Related questions
Question
Ms. Ligaya wants to buy her dream car. However, she does not have enough money to pay for ₱5,000,000 full price of the car. She negotiated with the sales agent and paid a down payment of ₱2,000,000 and borrowed ₱3,000,000 from Pure Gold Bank and signed a 4-year note payable stating the interest rate was 4% compounded annually. Ms. Ligaya will make payments of ₱826,470.14 at the end of each year. How much will be the principal amortization on the 2nd payment? (Provide solution/ explanation)
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 3 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Individual Income Taxes
Accounting
ISBN:
9780357109731
Author:
Hoffman
Publisher:
CENGAGE LEARNING - CONSIGNMENT
Individual Income Taxes
Accounting
ISBN:
9780357109731
Author:
Hoffman
Publisher:
CENGAGE LEARNING - CONSIGNMENT