Recall that the United States rule basically means that you always pay off the interest owed before paying towards the principal you owe. Start by trying a single partial payment example. I recommend that you organize your information in table form. It will help when the problems get more involved. You take out a simple interest loan for 12 months for $5000 at 3%. You make a partial payment of $3000 after 5 months. Follow these steps to fill in the table and answer the questions that follow. a. Enter the amount borrowed in the first line and under the "Starting Principle owed" b. Use the simple interest formula to calculate the interest owed by the time the first partial payment is made. (The interest on the full $5000 over the first 5 months.) Enter this amount in the first row and second column. c. Enter the $3000 in the third column, first row. d. Subtract the interest you found in part b from the $3000 and that is the principle that was paid at 5 months. Enter it in the fifth column. e. Subtract the principle paid from the starting principle (4 column entry from the 1" column entry). This is your "Remaining balance" for the last column in the first row as well as the "Starting Principle owed" for the 2" row. 1. For the last payment - last row. The interest you owe will be on the remaining principle for the time remaining on the loan 1. The starting principle will be the same as the remaining balance from the row immediately above it. ii. The time remaining will be the time from the time of the partial payment (5 months) to the end of the loan (12 months) iii. Use the simple interest formula to find out how much interest is owed on the remaining principle for the remainder of the loan. iv. This time you add the interest to the principle to calculate the final payment. Starting Payment Principle Remaining Principle owed owed balance Interest made paid 9. How much is the final payment for this loan