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Basile [38]
3 years ago
7

After visiting several automobile dealerships, Richard selects the used car he wants. He likes its $11,500 price, but financing

through the dealer is no bargain. He has $1,500 cash for a down payment, so he needs an $10,000 loan. In shopping at several banks for an installment loan, he learns that interest on most automobile loans is quoted at add-on rates. That is, during the life of the loan, interest is paid on the full amount borrowed even though a portion of the principal has been paid back. Richard borrows $10,000 for a period of four years at an add-on interest rate of 11 percent.
What is the total intetrest on Richard's loan?
What is the total cost of the car?
What is the monthly payment ?
What is the annual percentage rate?
Business
1 answer:
aksik [14]3 years ago
3 0

Explanation:

I = Prt

I = (10000)(.11)(4) = $4400

Total Cost = Down Payment + Principal Borrowed + Interest

Total Cost = 2000 + 8000 + 4400

= $14,400

Monthly Payment = (Principal Borrowed + Total interest) / Total number of payments

Monthly Payment = (10,000 + 4400) / 48

= $300

APR= (2 × n × I) / [P × (N + 1)]

APR = (2 × 12 × 4400) / [10,000 × (48+1)]

= 21.55%

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3 0
3 years ago
which of the following entries records the adjustment for revenue earned, but not yet collected? multiple choice debit accounts
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various options Debit receivables from customers, credit sales. Accounts Receivable is debited and Sales Revenue is credited. Sales revenue is debited and deferred revenue is credit. Debit receivables and credit deferred revenue are the two balances.

<h3> What are debit and credit?</h3>

An accounting entry that decreases an asset or cost account is known as a debit. or reduces an equity or liability account. In an accounting entry, it is placed on the left. An accounting item known as a credit raises a liability or equity account's balance. or lowers an account for an asset or expense.

The money that is placed into your checking account is a credit to the bank even if it is a debit to you (an increase in your asset) because it is not their money. It is your money, and the bank owes it to you, so it is a liability on their books. A credit is an increase in a liability account.

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Debit or Credit Account: As a business owner, your equity grows as a result of your revenue. Revenues must be reported as credits rather than debits because your equity typically has a credit balance.

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When a business sells anything, it reports the revenue from the transaction on its income statement. They list the amount owed as accounts receivable on their balance sheet if the consumer hasn't yet paid them for the purchase. The amount indicated on the income statement is offset by accounts receivable.

To know more about Debit or Credit , visit:

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7 0
1 year ago
reonna Corporation leases equipment from Falls Company on January 1, 2020. The lease agreement does not transfer ownership, cont
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$35,000

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