Loan Amortization ALWAYS USE PVA FORMULA Lecture Question 1. Suppose you had borrowed $500,000 at 8% annual interest for five years to purchase a new car. Payments are made at the end of each year. Prepare a loan amortization table. LOAN AMORTIZATION SCHEDULE YEAR Opening (Period) Balance PAYMENT INTEREST 8% PRINCIPAL CLOSING REPAYMENT BALANCE INTEREST OPENING BALANCE = INTEREST RATE PRINCIPAL REPAYMENT PAYMENT - INTEREST CLOSING BALANCE = OPENING BALANCE - PRINCIPAL REPAYMENT