# Serial Installments; Amounts Applicable to Interest and Principal Ronald McDuffie purchases a new car at a cost of $14,400. He pays$3,000 down and issues an installment note payable by which he promises to pay the balance in 18 equal monthly installments, which include interest at an annual rate of 18% on the remaining unpaid balance at the beginning of each month starting with the first month after the purchase. Required: 1. Compute the equal installment payments. 2. Compute the interest that will be paid for each of the first two periods. Indicate the amount of each payment that will be a reduction of principal.

### Intermediate Accounting: Reporting...

3rd Edition
James M. Wahlen + 2 others
Publisher: Cengage Learning
ISBN: 9781337788281

### Intermediate Accounting: Reporting...

3rd Edition
James M. Wahlen + 2 others
Publisher: Cengage Learning
ISBN: 9781337788281

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Chapter M, Problem 8P
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