Amortization schedule E F G 1 2 3 CONOWN Loan amount to be repaid (PV) Interest rate Length of loan in years) $37,000.00 10.00% 3 5 6 a. Setting up amortization table Calculation of loan payment 8 Formula NA Interest Repayment of Principal Remaining Balance 10 Year Beginning Balance Payment 11 1 12 2 13 3 14 15 b. Calculating % of Payment Representing Interest and Principal for Each Year Payment Payment Representing Representing 16 Year Interest Principal 17 1 18 2 19 3 20 21 Formulas Check Total = 100% Renament Formulas Year 1 2 3 Beginning Balance #N/A #NIA #N/A Payment #N/A #N/A #N/A Interest #NA #NA #NIA Repayment of Principal #N/A #N/A #N/A Remaining Balance #N/A #N/A INIA b. Calculating % of Payment Representing Interest and Principal for Each Year Payment % Payment % Representing Representing Year Interest Principal 1 #N/A #N/A 2 #N/A ANIA 3 #N/A #N/A Check Total = 100% #N/A #N/A #N/A r F a. Complete an amortization schedule for a $37,000 loan to be repaid in equal installments at the end of each of the next three years. The interest rate is 10% compounded annually. Round all answers to the nearest cent. Beginning Balance Repayment of Principal Ending Balance Year Payment Interest 1 $ $ $ $ 5 2 $ $ $ $ $ 3 $ $ $ $ b. What percentage of the payment represents Interest and what percentage represents principal for each of the three years? Round all answers to two decimal places. % Interest Year 1: % Principal 96 Year 2: % 96 Year 3: 96 96 Why do these nercentages chance over time? c. Why do these percentages change over time? 1. These percentages change over time because even though the total payment is constant the amount of interest paid each year is dedining as the remaining or outstanding balance declines. II. These percentages change over time because even though the total payment is constant the amount of Interest paid each year is increasing as the remaining or outstanding balance declines. III. These percentages change over time because even though the total payment is constant the amount of interest pald each year is declining as the remaining or outstanding balance increases IV. These percentages change over time because even though the total payment is constant the amount of interest paid each year is Increasing as the remaining or outstanding balance increases. V. These percentages do not change over time; interest and principal are each a constant percentage of the total payment