ramon hernandez saw the following advertisement for a used volkswagen bug and decided to work out the numbers to be sure the ad had no errors. cash price $7,880 down payment $0 annual percentage rate 14.53% deferred price $11,131.80 or 60 payments at $185.53 per month a. calculate the amount financed: b. calculate the finance charge. (round your answer to the nearest cent.): c. calculate the apr by table lookup. (use table 14.1(b).) (round your answers to 2 decimal places.): d. calculate the monthly payment by formula. (round your answer to the nearest cent.): Calculate the monthly payment by table lookup at 14.50% (Use table 14.2 round your answer to the nearest cent):
ramon hernandez saw the following advertisement for a used volkswagen bug and decided to work out the numbers to be sure the ad had no errors. cash price $7,880 down payment $0 annual percentage rate 14.53% deferred price $11,131.80 or 60 payments at $185.53 per month a. calculate the amount financed: b. calculate the finance charge. (round your answer to the nearest cent.): c. calculate the apr by table lookup. (use table 14.1(b).) (round your answers to 2 decimal places.): d. calculate the monthly payment by formula. (round your answer to the nearest cent.): Calculate the monthly payment by table lookup at 14.50% (Use table 14.2 round your answer to the nearest cent):
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 83E
Related questions
Question
ramon hernandez saw the following advertisement for a used volkswagen bug and decided to work out the numbers to be sure the ad had no errors. cash price $7,880 down payment $0 annual percentage rate 14.53% deferred price $11,131.80 or 60 payments at $185.53 per month
a. calculate the amount financed:
b. calculate the finance charge. (round your answer to the nearest cent.):
c. calculate the apr by table lookup. (use table 14.1(b).) (round your answers to 2 decimal places.):
d. calculate the monthly payment by formula. (round your answer to the nearest cent.):
Calculate the monthly payment by table lookup at 14.50% (Use table 14.2 round your answer to the nearest cent):
Transcribed Image Text:TABLE 14.2
Loan amortization table (monthly payment per $1,000 to pay principal and interest on installment loan)
Terms in
months
7.50%
8.00%
8.50%
9.00%
10.00%
10.50%
11.00%
11.50%
12.00%
6
$170.34
$170.58
$170.83
$171.20
$171.56
$171.81
$172.05
$172.30
$172.55
12
86.76
86.99
87.22
87.46
87.92
88.15
88.38
88.62
88.85
18
58.92
59.15
59.37
59.60
60.06
60.29
60.52
60.75
60.98
24
45.00
45.23
45.46
45.69
46.14
46.38
46.61
46.84
47.07
30
36.66
36.89
37.12
37.35
37.81
38.04
38.28
38.51
38.75
36
31.11
31.34
31.57
31.80
32.27
32.50
32.74
32.98
33.21
42
27.15
27.38
27.62
27.85
28.32
28.55
28.79
29.03
29.28
48
24.18
24.42
24.65
24.77
25.36
25.60
25.85
26.09
26.33
54
21.88
22.12
22.36
22.59
23.07
23.32
23.56
23.81
24.06
60
20.04
20.28
20,52
20.76
21.25
21.49
21.74
21.99
22.24
TABLE 14.2
(concluded)
Terms In
months
12.50%
13.00%
13.50%
14.00%
14.50%
15.00%
15.50%
16.00%
6
$172.80
$173.04
$173.29
$173.54
$173.79
$174.03
$174.28
$174.53
12
89.08
89.32
89.55
89.79
90.02
90.26
90.49
90.73
18
61.21
61.45
61.68
61.92
62.15
62.38
62.62
62.86
24
47.31
47.54
47.78
48.01
48.25
48.49
48.72
48.96
30
38.98
39.22
39.46
39.70
39.94
40.18
40.42
40.66
36
33.45
33.69
33.94
34.18
34.42
34.67
34.91
35.16
42
29.52
29.76
30.01
30.25
30.50
30.75
31.00
31.25
48
26.58
26.83
27.08
27.33
27.58
27.83
28.08
28.34
54
24.31
24.56
24.81
25.06
25.32
25.58
25.84
26.10
60
22.50
22.75
23.01
23.27
23.53
23.79
24.05
24.32
Transcribed Image Text:TABLE
14.1
(concluded)
ANNU AL PERCENT AGE RATE
NUM BER
OF
PAYMENTS 14.00% 14.25% 14.50% 14.75% 15.00% 15.25% 15.50% 15.75% L6.00% 16.25 16.50% 16.751 17.00% 17.25% 17.501 17.758
(FINANCE CHARGE PER $100 OF AMOUNT FINANCEDI
1.17
1.19
1.75 1,78
1.40 1.42
1.44
2.16
1.46
2.19
2.93
3.67
4.42
1.48
2.22
2.97
3. 73
4.48
1.21
1.82
1.25
1.88
1.33
2.00
2.68
3.36
1.35
2.04
2.72
3.41
1.37
2.07
2.16
3.46
1.23
1.85
1.27 1.29
1.94
2.59
3.25
3.91
1.31
1.97
2.64
3, 30
1.91
2.10
2.13
2.34
2.38
2.43
2.47
2.80
2.A5
2. A9
2.51
3.14
3.78
2.55
2.93
3.51
3.57
3.62
2.99
3.59
3.04
3.09
3.72
3.20
3.84
5
3.53
3.65
3.97
4.04
4.10
4.16
4.21
4.29
4.35
5.09
4.12
5.40
4.79
5.49
4.87
5.58
4.94
5.02
5.17
5.24
6.00
6.77
7.54
R. 31
4.57
4.64
4.12
4.72
4.20
4.27
4.89
4.35
4.98
4.42
5.06
5.71
6.35
7.00
4.49
5.15
5.80
5.66
6.38
7.11
7.84
4. 81
5.23
5.32
5.75
5.83
5.92
6.19
6.89
7.40
6.58
7.32
6.67
7.43
8.19
6.29
6.48
7.22
5.51
5.61
6. 25
6. 88
5.90
6.00
5.32
5.92
6.53
5.42
6.03
6.09
6.78
7.48
6.46
7.00
6.57
7.24
6.68
6.14
6.77
7. 36
10
6.65
7.12
7.12
1.96
8.08
9.09
9.87
10.66
11.45
7. 53
8.31
9.02
8.44
9.16
8. 96
8.57
9. 30
10.04
10.78 10.95 11.11
8.70
9.45
11
8.05
8.18
8.83
7.14
7.74
8.36
8.97
7.27
1.89
7.40
7.66
8.31
1.19
8.45
9.12
1.92
9.59
8.17
8. 81
9. 46
9.73
10.50
11.28
8.59
8.74
8.88
9.58
12
13
14
15
8.03
8.66
9.30
9.27 9.43
9.79 9.96 10.12 10.79
9.71
10.45 10.5?
9.89
10.20 10.35
8.51
9.13
9.76
8.97
9.63
9.59
9.94 10.11 10.29 10.47 10.64 10.A2 11.00 11.17 11.35 11.33 11.71 1l.08 12.06
10.95 11.14 11.33 11.52 11.71 11.90
12.09
12.43 13.03
13.57 13.99 14.21
12.28
16
17
10.20 10.39 10.58 10.77
10.82 11.02
11.45 11.66
12.46 12.65 12.84
13.23
13.03
13.83
14.64
11.22
12.42
12.67
13.14 13.35
13.43 13.63
11.42 11.62 11.82 12.02 12.22
12.08 12.29
12.74
18
11.87
12.50 12.72 12.93
13.78
14.42
12.97 13.19 13.41
12.70 12.93 13.17 13.41 13.64 13.8A 14.11 14.35 14.59 14.A2
14.31 14.54 14.76 14.99 15.22
15.06 15. 30 15.54 15.77 16.01
19
12.07 12.30
12.52
13.64
13.96 14.09
15.44
20
16.25
13.33 13.58 13.82 14.07
14.32 14.57 14.82 15.06
15.31 15.56
15.A1 16.06 16.31 16.56 16.81
17.07
21
22
23
24
25
15.00 15.26 15.5? 15.78
15.68
16.37
16.83
17.32 17.60 17.84 18.15
17. 88
18.70
19.53
19.45 19. 75 20.05 20. 36
16.04
16.78
16.30
17.05
16.57
17.09 17.36 17.62
IA.43
13.96 14.22 14.48 14. 74
15.14
15.80
15.87 16.17 16.46 16. 76 17.06
16.50
16.94 17.22
17.95
16.23
14.59 14.87
15.23 15.51
15.41
16.08
15.96
16.65
17.35 17.65
17.51 17. A0 LA.09 1H.37 1A.66 18.95 19.24
1H. 37
1A. 66
18.25 1A.55
18.85 19.15
20.24 20.56 20.87 21.19
21.69
21.84 27.1A 22.52 22.86
23.35
26
27
16.51 16.82 17.13 17.44 18.06
17.15 17.47 17.80 18.12
17.80 18.13 18.47
18.45 18.79
1A.6A
19.41
18.80 19.14 19.47 19.A1 20.15
20. A9
17.75
16.17
18.76 19.09
18.99 19.30
20.0A
20.A2
21.58
19.62 19.93
20.19 20.7I
18.44
21.04 21.37
22.02
19.74
20.48
21.16 21.50
21.14
22.29
21.99 27.35 22.72 ?3.0A 23.45 23. A1
28
29
19.14
19.49
19. A3 20.18
20.53
21.23
27.64 22.99
23.70
30
19.10 19.45 19.81 20.17 20.54 20.90 21.26 21.62
24.1A 24.55
19.75
20.40 20.79 21.17 21.56 21.95
22.37
23.11
22.74 23.12
23.50
23.49
23.50 23.9A 24.25
24.28 24.6A
25.02 25,40
25. A6 26.25
24.64
25.46
25:88 26.29
26.70 27.1?
27. 96
31
32
20.12 20.49 20.87 21.24 21.61
21.99
22.33 22.72
25.07
21.85 22.25
22.54
22.80 23.23 23.65
22.65 23.06
23.46
23.86
33
34
35
21.06 21.46
21.72 22. I3
22.38
24.26
25.03
24.67
25.44
26.23
25.07
25.46
25.49
26. 24
26.70
27.11
27.54
27.97
24.39 28.83
22.95 23.37 23.78
24.19
24.61
24.08 24.51 24.94 25. 36
25.79
26.66 27.09
27.52
27.46 27.90 28.35 2A.R0 29.25 29.70
30.57
23.92 24.35 24.80 25.24 25.6A 26.12 26.57
25.97
26.24 26.7O 27.17
26.96 27.44
25.71 26.20 26.70 27.19 27.69 28.18 28.68 29.18 29,68 30. 18
36
27.01
23.04 23.48
23.70 24.16
24.61
25.06
25.51
26.42
2A, 7?
26.8A
27.34
27.64
28.11
28.41 28.R9
27.80
28.59
29.38
28.26
29.64
30.49
30.85 31.34
29.18
37
38
39
40
10.10
30.96
31. A3
29.06 29.53 30.01
31.44
32.32
30.69 32.60 33.20
24.37 24.84
25.30 25.77
25.04 25.52
26.00 26.48
27.92
29.37
30. 36
31.19 31.6A 32.19
30.46
31.25
29.44
31.49
29.95
30.72
30.97
31.78
32.58
32.01
32.52
33.17
33.04
13.55
41
42
26.39 26.89 27.40 27. 91 28.41 28.92
28.10 28. 62
27.74 28.27 28.81 29.34 29. 88
34.08
34.97
35.86
27.06
27.58
29.15
32.31 32. A4
33. 90
29.67
30.42
30.19
30.96
34.44
35.31
43
31.50
32.04
33.13
33.67
34.22
34. 76
33.39
34.20
35.07 35.63
35. 92
30.62 31.17
31.72
31.92 32.49
32.28
32.83
28.42
29.11
33.95
34.77
34.51
35. 35
36.19
37.08
28.97
29.52 30.07
36.76
37.66
44
45
29.67
30.23
30. 79
31.36
33.06
33.63
36.50
32.10 32.68 33.26
32.84
33.59
33.84
34.43
35.01
35.23 35.83
35.60 36.139 36.78
37. 37
37.96
3A. A6
39. 75
40.65
46
29.79
30. 36
30.94 31.52
38.56
31.66 32.25
32.37
32.98
33.44 34.03
34.63
36.43
37.04 37.64
39.46
40.37
47
30.48 31.07
31.77
32.48 33.09
3A.25
39.13
34.20
35.42
34.81
35.59 36.21
36.65
36.84 37. 47
37.65
36.03
37.27
37. 8A 38.5o
3A. 74 39.37 40.01
40.24
48
31.17
31.86
33.71
39.10
34. 34
35.09 35. 73 36.37
34.96
49
50
41.29
42.20
32.55
33.18
33.82 34. 45
37.01
38.30
3A.94
39.59
40.89 41.55
33. 89
36.49 37.15
37.94
38.72
41.7A 42.45
43.36
43.57 44.27
37. A1
38.46
39.12
34.54
35.27
36.00
36.73
39.79 40.45 41.11
41.31
42.17
43.04
35. 19 35.84
51
52
53
54
33.25
33.95
34.65
35.35
34.61
35. 32
36. 04
35.93
36. 68
37.42
36.60 37.27
37.36
38.04
38.82
38.12
39.28
40.10 40.79
40.92 41.63
41.99 42.67
42.97
43.75
43.12
44.04
44.97
45.90
38.61
39.41
39.96
40.63
41.48
39.52
40.22
42.33
44.47
45.18
55
36.05
36.76
37.46
ЗА. 17
38.88 39.60
40.31
41.03
41.74
42.47
43.19
43.91
44.64
45.37 46.10
46.83
45.53
46.42
46.54 47.32 48.09
48.21
38.20 38.92
42.57
43.40
44.23
43.51 44.29 45.07
45.11 45.91
41.84
42.65
43.47
43.31
44.05
44.79
45.66
56
47.02
47.77
36.76
37.47
38.18 38.93 39.68 40. 43
37.48
39.65
40.42
41.19 41.95 42.71
40.38 41.11
41.16
41.91
46.27
47.18
38.20
38.94 39. 68
44.15
44.41
45.77
57
47.94
4P.71
58
45.00
48.47
49.65
45.85
46.64
47.51 48.31
39. 66
41.19
41.96
42.74
47.42
49.01
49.92
49.80
50.60
59
60
38.89
40.42
39.61 40.39
41.17 41.95
42.74 43.53 44.32
46.71
49.12
50.73
51.55
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