1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
DENIUS [597]
2 years ago
9

Julie and Barry Spinos purchased a house for $96,400. They made a 25 percent down payment and financed the remaining amount at 5

.50 percent for 30 years. Their monthly payment is $410.66. How much of the first monthly payment is used to reduce the principal?
Business
1 answer:
Alinara [238K]2 years ago
5 0

Answer: $79.30

Explanation:

Cost of the house = $96400

Down payment = 25% × $96400 = $24100

Mortgage = $96400 - $24100 = $72300

Interest = 5.5%

Time = 5 years

Monthly payment.= $410.66

The interest for first payment will be:

= $72300 × 5.5% × 1/12

= $72300 × 0.055 × 0.08333

= $331.36

Therefore, the amount of the first monthly payment is used to reduce the principal will be:

= $410.66 - $331.36

= $79.30

You might be interested in
Case Study: Assume that are the financial manager of a company, which is considering a
krok68 [10]

Answer:

Explanation:

The calculation can be done using sensitivity analysis

The sensitivity analysis is done as follows:

Scenario NPV Deviation in NPV from orignial scenario % depletion

Original 6140513

Unit sale decreases by 10% 5286234 -854279 13.91%

Price per unit decreases by 10% 2894254 -3246259 52.87%

Variable cost per unit increases 10% 5286234 -854279 13.91%

Cash fixed cost per year increases by 10% 6062851 -77662 1.26%

Calculation of original NPV

Sales (350000 * 22) 7700000

Less: Variable cost (350000 * 11) -3850000

Less: Fixed cost -350000

Less: Depreciation [(2000000 - 200000) / 4] -450000

Profit before tax 3050000

Less: Tax at 30% -915000

Profit after tax 2135000

Add: Depreciation 450000

Cash flow after tax 2585000

0 1 2 3 4

Initial investment -2000000

Working capital -600000

Cash flow after tax 2585000 2585000 2585000 2585000

Working capital released 600000

Residual value 200000

Net cash flows -2600000 2585000 2585000 2585000 3385000

PVF at 10% 1 0.9091 0.8264 0.7513 0.6830

Present value -2600000 2350000 2136364 1942149 2312001

NPV 6140513

Calculation of NPV when unit sales decrease by 10%

Sales (315000 * 22) 6930000

Less: Variable cost (315000 * 11) -3465000

Less: Fixed cost -350000

Less: Depreciation [(2000000 - 200000) / 4] -450000

Profit before tax 2665000

Less: Tax at 30% -799500

Profit after tax 1865500

Add: Depreciation 450000

Cash flow after tax 2315500

0 1 2 3 4

Initial investment -2000000

Working capital -600000

Cash flow after tax 2315500 2315500 2315500 2315500

Working capital released 600000

Residual value 200000

Net cash flows -2600000 2315500 2315500 2315500 3115500

PVF at 10% 1 0.9091 0.8264 0.7513 0.6830

Present value -2600000 2105000 1913636 1739669 2127928

NPV 5286234

Calculation of NPV when price per unit decrease by 10%

Sales (350000 * 19.8) 6237000

Less: Variable cost (350000 * 11) -3850000

Less: Fixed cost -350000

Less: Depreciation [(2000000 - 200000) / 4] -450000

Profit before tax 1587000

Less: Tax at 30% -476100

Profit after tax 1110900

Add: Depreciation 450000

Cash flow after tax 1560900

0 1 2 3 4

Initial investment -2000000

Working capital -600000

Cash flow after tax 1560900 1560900 1560900 1560900

Working capital released 600000

Residual value 200000

Net cash flows -2600000 1560900 1560900 1560900 2360900

PVF at 10% 1 0.9091 0.8264 0.7513 0.6830

Present value -2600000 1419000 1290000 1172727 1612526

NPV 2894254

Calculation of NPV when variable cost per unit increases 10%

Sales (350000 * 22) 7700000

Less: Variable cost (350000 * 12.1) -4235000

Less: Fixed cost -350000

Less: Depreciation [(2000000 - 200000) / 4] -450000

Profit before tax 2665000

Less: Tax at 30% -799500

Profit after tax 1865500

Add: Depreciation 450000

Cash flow after tax 2315500

0 1 2 3 4

Initial investment -2000000

Working capital -600000

Cash flow after tax 2315500 2315500 2315500 2315500

Working capital released 600000

Residual value 200000

Net cash flows -2600000 2315500 2315500 2315500 3115500

PVF at 10% 1 0.9091 0.8264 0.7513 0.6830

Present value -2600000 2105000 1913636 1739669 2127928

NPV 5286234

Calculation of NPV when cash fixed cost per year increases by 10%

Sales (350000 * 22) 7700000

Less: Variable cost (350000 * 11) -3850000

Less: Fixed cost -385000

Less: Depreciation [(2000000 - 200000) / 4] -450000

Profit before tax 3015000

Less: Tax 30% -904500

Profit after tax 2110500

Add: Depreciation 450000

Cash flow after tax 2560500

0 1 2 3 4

Initial investment -2000000

Working capital -600000

Cash flow after tax 2560500 2560500 2560500 2560500

Working capital released 600000

Residual value 200000

Net cash flows -2600000 2560500 2560500 2560500 3360500

PVF at 10% 1 0.9091 0.8264 0.7513 0.6830

Present value -2600000 2327727 2116116 1923742 2295267

NPV 6062851

3 0
3 years ago
Jen Rogers withdrew a total of $35,000 from her business during the current year. The entry needed to close the withdrawals acco
Dmitrij [34]

Answer and Explanation:

The journal entry is shown below:

Jen Rogers, Capital $35,000

         To Jen Rogers, Withdrawals $35,000

(Being withdrawals entry is recorded)

Here the Jen Rogers, Capital is debited as it decreased the stockholder equity while the Jen Rogers, Withdrawals is credited as it also decreased the drawings account. Also, the capital contains normal credit balance while drawings contains normal debit balance

6 0
3 years ago
How did my account get reset
harkovskaia [24]

Answer:

they somtimes do that to help the site

Explanation:

6 0
2 years ago
Gamma Company budgeted to use 2 pounds of materials per unit at a budgeted cost of $100 per pound. Budgeted production and sales
MaRussiya [10]

Answer:

Gamma Company

The input price and input quantity variances are:

Input Price - Unfavorable; Input Quantity - Unfavorable

Explanation:

a) Data and Calculations:

Budgeted pounds of materials per unit = 2

Budgeted cost per pound = $100

Budgeted material price per unit =  $200

Budgeted production and sales volume = 5,000 units

Budgeted materials = 10,000 pounds

Actual production and sales volume = 4,000 units

Standard quantity of materials for actual production = 8,000 (4,000 * 2)

Actual quantity of materials used = 8,080

Quantity variance = 80 (8,080 - 8,000) Unfavorable

Total budgeted cost = $800,000 (8,000 * $100)

Total actual cost = $824,160 (8,080 * $102)

Price variance = $2 ($102 - $100) Unfavorable

8 0
3 years ago
Differential Analysis for a Lease-or-Sell Decision Sure-Bilt Construction Company is considering selling excess machinery with a
Tju [1.3M]

Answer:

A. $2,870

B. It would be advisable to sell the machinery

Explanation:

a. Preparation of a differential analysis, to determine whether Sure-Bilt should lease (Alternative 1) or sell (Alternative 2) the machinery

DIFFERENTIAL ANALYSIS

Lease (Alternative 1) or sell (Alternative 2) the machinery May 25

Lease machinery (Alternative 1)

Revenue $284,400

Cost $24,500

Income/loss$259,900

Sell machinery (Alternative 2)

Revenue $276,600

Cost $13,830 (5%*276,600)

Income/loss $262,770

Differential effect on income (Alternative 2)

Revenue ($284,400-$276,600)=$7,800

Cost ($24,500-$13,830)=$10,670

Income/loss($259,900-$262,770)=$2,870

b. On the basis of the data presented above , it would be advisable sell the machinery and the benefit from selling the machinery will be the amount of $2,870

7 0
3 years ago
Other questions:
  • What will be the result when managers use new forms of organizing?
    15·1 answer
  • Pearson Company bought a machine on January 1, 2014. The machine cost $144,000 and had an expected salvage value of $24,000. The
    12·1 answer
  • To utilize sophisticated _________ segmentation, the marketing must know more than age, race and gender about the target market.
    15·1 answer
  • Something you enjoy or want to know more about is a(n) _____.
    6·2 answers
  • During its first year of operations, Eastern Data Links Corporation entered into the following transactions relating to sharehol
    13·1 answer
  • it is a good idea to accept a promotion interview even if you're not interested in the promotion because, ________. ​
    7·1 answer
  • FYI; for those of you who "do not find this set up of the site fair" are ridiculous an unappreciative. This site and the coopera
    15·1 answer
  • For several years, Mountain Home University had used IBM computers. Recently, Apple Computers offered them a better machine at l
    6·1 answer
  • Ano ang teoryang maaring makapagliwanang sa pinagmulan ng kapuluan ng pilipinas?​
    5·1 answer
  • environmental performance indicators that are the critical success factors in a sustainability perspective include
    8·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!