Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

b) Prepare an amortisation schedule for a four-month loan $8,500. The interest rate is 9.5% per year with monthly compounding and the loan calls for

image text in transcribed

b) Prepare an amortisation schedule for a four-month loan $8,500. The interest rate is 9.5% per year with monthly compounding and the loan calls for equal monthly payments. i. Calculate the monthly loan repayment. [Clearly show all formula(s), steps, relevant figures and final answer. Round only the final answer to two decimal places, where applicable.] (1 mark) Click here to enter text. ii. Fill in all relevant values under each column in the table below. Show the formula(s) used to calculate each column. (2 marks) Display formulas here: Interest expense: Principal repayment: Click here to enter text. Outstanding loan balance: Click here to enter text. iii. State the interest amounts paid in the first and final periods. Which of these two periods has a lower interest amount? Clearly explain why this is the case. Use relevant figures for illustration. Also comment on the outstanding loan balance at the end of final period. ( 2 marks) Click here to enter text

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

More Books

Students also viewed these Finance questions

Question

8. Explain the relationship between communication and context.

Answered: 1 week ago