On December 31, 2017, Oakbrook Inc. rendered services to Beghun Corporation at an agreed price of $102,049, accepting $40,000 do
wn and agreeing to accept the balance in four equal installments of $20,000 receivable each December 31. An assumed interest rate of 11% is imputed. Prepare an amortization schedule. Assume that the effective-interest method is used for amortization purposes.
1 answer:
Answer:
Loan Amortization Table is attached with this answer, please find it
Explanation:
First of all we calculate the Loan Payment per period
Loan Payment per year = r ( PV ) / 1 - ( 1 + r )^-n
Loan Payment per year = 0.11 ( (102,049 - 40,000 ) / 1 - ( 1 + 0.11 )^-4
Loan Payment per year = $6,825.39 / 0.341269 = 20,000 per year
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