On January 1, Year 1, Beatie Co. borrowed $200,000 cash from Central Bank by issuing a five-year, 6 percent note. The principal
and interest are to be paid by making annual payments in the amount of $47,479. Payments are to be made December 31 of each year, beginning December 31, Year 1.
Required:
1. Prepare an amortization schedule for the interest and principal payments for the five-year period. (Round your answers to the nearest dollar amount.)
Required:
1. Prepare an amortization schedule for the interest and principal payments for the five-year period. (Round your answers to the nearest dollar amount.)
1 answer:
Answer:
Amortization Schedule is attached with answer please find it.
Explanation:
Loan Payment includes the the principal and interest payment for the period. First we calculate the interest portion in the payment and then residual amount after deducting the interest portion is considered as the principal payment.
In this question the loan payment of $47,479 includes the Interest payment and principal payment as well, which is shown separately in the schedule.
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Answer: $770.22
Explanation:
If she makes equal contributions then those would be annuities. The $9,000 she wants to have will be the future value of the amount currently in her account and the annuity.
9,000 = 5,000 ( 1 + r) ^ n + ( annuity * future value interest factor of an annuity, 9%, 3 years)
9,000 = 5,000 ( 1 + 9%) ^ 3 + ( Annuity * 3.2781)
9,000 = 6,475.145 + 3.2781 * Annuity
Annuity = (9,000 - 6,475.145) / 3.2781
Annuity = $770.22
