- LO 12.1 Campus Flights takes out a bank loan in the amount of $200,000 on March 1 . The terms of the loan include a repayment of principal in ten equal installments, paid annually from March 1 . The annual interest rate on the loan is 8%, recognized on December 31 . (Round answers to the nearest whole dollar if needed.) 1. The interest expense recognized as of December 31 in year 1 rounded to the whole dollar is $ 2. The principal due in year 1 is $