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3 years ago

Zach buys a car for $18,900 with 5% interest over 5 years. What is true about this monthly payment loan?

Business

2 answers:

xeze [42]3 years ago

6 0

Answer:

Zach will pay $4,725 in interest on the loan.

Explanation:

In calculating interest the formula that applies is

I= P x R x T

where I = interest

P = principal amount

R = interest rate

T= time

In the case of Zach

I= $18,900 x 5/100 x 5

I = $18,900 x 0.05 x 5

I =$945 x 5

I =$4,725

Interest for the loan is $4,725

Nady [450]3 years ago

6 0

Answer: Zach will pay $2,500 in interest on this loan

Explanation: First, we must calculate Zach's monthly payment.

P=18900⋅ (0.05/12)

________________. = 356.67

1- ( 1 + 0.05/12) ^-60

If the monthly payments are $356.67, then the yearly payback is 356.67⋅12=$4280.04.

And, he will pay that each year for 5 years. So, 4280.04⋅5=$21,400.20 is the total payback amount.

Therefore, Zach will pay 21,400.20−18,900=$2500.20 in interest over the life of the loan.

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She negotiated a price of $21,900 and will trade in her old car for $2,350. She will put another $850 with it and borrow the rem

lisabon 2012 [21]

Answer:

The monthly payment will be $434

Explanation:

Price of New car = $21,900

Price of old car exchanged = $2,350

Cash Payment = $850

Amount of Loan = $21,900 - $2,350 - $850

Amount of Loan = A = $18,700

Rate of interest = r = 6% = 0.06 = 0.005 per month

Number of total periods = 12 x 4 = 48

P = $18500 / { [ ( 1 + 0.005 )^48 ] - 1 } / [ 0.005 ( 1 + 0.005)^48 ]

P = $18500 / [ 0.2704891611 / 0.006352446 ]

P = $18500 / 42.58

P = $434.47

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4 years ago

Michael has written an e-mail to his employees that describes a new product special that will be introduced to the customers nex

lutik1710 [3]

Answer:

Effective Communication

Explanation:

The goal of effective communication is understanding between sender and receiver. In other words, when the message is understood as intended, effective communication happens.

Michael is taking care of the words he uses, his arguments, and the format, and these actions will help him achieve the goal of effective communication.

7 0

4 years ago

A. Butcher Timber Company hired your consulting firm to help them estimate the cost of equity. The yield on the firm's bonds is

stealth61 [152]

Answer:

14.35%

Explanation:

In this given case, Risk free return will be yield on bond = 10.50%

Risk Premium given = 3.85%

But beta of company is not given, and market beta also not given, hence we can not calculate beta.

we can assume beta of company is 1, then-

Cost of equity can be calculated as:

= Risk free return + [Beta × Risk Premium]

= 10.50% + [1 × 3.85%]

= 10.50% + 3.85%

= 14.35%

Note:

Retained earning also not given so that we calculate based of retained earning.

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3 years ago

If the manufacturer of Cool Whip were to introduce an orange-flavored Cool Whip and still continue to produce all of its other C

AlexFokin [52]

Answer:

B. Line extension

Explanation:

Product Line Extension

This involves the use of an already established brand name, in this case, cool whip for a new item (orange flavored cool whip) in the same product category. It's the production of a new product that is a little different to a company's existing products. The differences the new product usually has from the existing products may be in the line of new flavour, colors, product size, added ingredients and so on.

A popular example of this is Coke and Pepsi releasing Diet Coke and Pepsi respectively. Adding a new product to their existing range of products.

5 0

3 years ago

On June 1, 2020, Forde Auto Manufacturer sells a 4-door sedan to a dealer for $6,000, which includes three years of maintenance.

hichkok12 [17]

Answer:

Part a

Allocation based on Stand Alone Selling Prices :

4 - door Sedan and the 3 years maintenance contract = $6,400
Cash incentive = $100

Part b

Journal entry :

Debit : Cash $130,000

Credit : Revenue - 4 - door Sedan $128,000

Credit : Revenue - Cash incentive $2,000

Explanation:

It is important to identify the step in IFRS 15 - Revenue from Contracts with Customers, which is affected by the question.

Here, Step 2 - Identify the performance obligation in the contract, Step 3 - Determine the Transaction Price, Step 4 - Allocate the Transaction Price to the Performance obligation and Step 5 - Recognize the Revenue as or when the Performance Obligation is Satisfied. These are explained and applied as follows :

Step 2 - Identify the performance obligation in the contract.

Here, identify the individual promises (Performance Obligations) that the entity has committed to transfer to the customer.

Also the entity identifies each performance obligation that is distinct, or a series of distinct Goods or Services that are substantially the same and have the same pattern of transfer to the customer.

So, the performance obligations are as follows :

4 - door Sedan and the 3 years maintenance contract(these can not be consumed independently from one another)
Cash incentive (can be consumed independently from the rest of the performance obligations)

Step 3 - Determine the Transaction Price

Transaction price is the consideration the entity expects to be entitled to in exchange of goods or services transferred to the customer.

Transaction Price is $6,500 ($6,000 + $400 + $100)

Step 4 - Allocate the Transaction Price to the Performance obligation

Allocation of Transaction Price is done based on Stand Alone Selling Prices.

Stand alone selling prices have already been identified :

4 - door Sedan and the 3 years maintenance contract = $6,400
Cash incentive = $100

Step 5 - Recognize the Revenue as or when the Performance Obligation is Satisfied

Stand alone for 20 vehicles :

4 - door Sedan and the 3 years maintenance contract = $6,400 x 20 = $128,000
Cash incentive = $100 x 20 = $2,000

Journal entry :

Debit : Cash $130,000

Credit : Revenue - 4 - door Sedan $128,000

Credit : Revenue - Cash incentive $2,000

8 0

3 years ago