Question
The Mackenzies also bought a business for $90,000. They borrowed the money to buy the business at 6.9% compounded semi-annually and are to repay the
The Mackenzies also bought a business for $90,000. They borrowed the money to buy the business at 6.9% compounded semi-annually and are to repay the debt by making quarterly payments of $3645
A)How many payments are required to repay the loan?f.What is the term of the loan in years and months?
B)What is the principal reduction in the 6th year?
C)What is the total cost of financing the debt?
D)If they make a lump sum payment of $10,000 at the end of the fourth year, by how much is the amortization period shortened?
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Accounting Tools for Business Decision Making
Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso
5th edition
9780470418239, 470239808, 9780470239803, 470418230, 978-1118128169
