Finding implicit interest rates constructing amortization schedules. Herman Company purchased a plot of land for possible future

Question:

Finding implicit interest rates constructing amortization schedules. Herman Company purchased a plot of land for possible future development. The land had fair value of $86,000. Berman Company gave a 3-year interest-bearing note. The note had of $100,000 and provided for interest at a slated rate of 8%. The note requires payments of 58,000 at the end of each of three years, the last payment coinciding with the of the note€™s of $100,000.
a. What is the interest rate implicit in the note, accurate to the nearest tenth of 1%?
b. Construct an amortization schedule for the note for each year. Show the carrying value of the note at the start of the year, interest for the year, payment for the year, amount reducing or increasing the carrying value of the note for each payment. and the carrying value of the note at the end of each year. Use the interest rate found in part a. See Exhibit 10.2 for an example of an amortizationschedule.

Amortization Schedule for $800,000 Loan, Repaid in 10 Semiannual Installments of $93,784.41. Interest Rate Is 6% Compoun

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Face value is a financial term used to describe the nominal or dollar value of a security, as stated by its issuer. For stocks, the face value is the original cost of the stock, as listed on the certificate. For bonds, it is the amount paid to the... Maturity
Maturity is the date on which the life of a transaction or financial instrument ends, after which it must either be renewed, or it will cease to exist. The term is commonly used for deposits, foreign exchange spot, and forward transactions, interest...