The Township of Langley borrowed $400,000 for road improvements. The debt agreement requires that the township pay the interest on the loan at the end of every year and make equal deposits at the time of the interest payments into a sinking fund until the loan is retired in fifteen years. Interest on the loan is 8% compounded annually and interest earned by the sinking fund is 9% compounded annually. (a) What is the periodic interest expense? (b) What is the size of the of the periodic payment into the sinking fund? (c) What is the periodic cost of the debt? (d) How much is the increase in the sinking fund in the 5th year? (e) What is the book value of the debt after 11 years? (a) The size of the periodic interest expense is $| (Round the final answer to the nearest dollar as needed. Round all intermediate values to six decimal places as needed.) (b) The size of the periodic payment is $ . (Round the final answer to the nearest dollar as needed. Round all intermediate values to six decimal places as needed.) (c) The size of the periodic cost is $ . (Round the final answer to the nearest dollar as needed. Round all intermediate values to six decimal places as needed.) (d) The increase is $ . (Round the final answer to the nearest dollar as needed. Round all intermediate values to six decimal places as needed.) (e) The book value is $ The Township of Langley borrowed $400,000 for road improvements. The debt agreement requires that the township pay the interest on the loan at the end of every year and make equal deposits at the time of the interest payments into a sinking fund until the loan is retired in fifteen years. Interest on the loan is 8% compounded annually and interest earned by the sinking fund is 9% compounded annually. (a) What is the periodic interest expense? (b) What is the size of the of the periodic payment into the sinking fund? (c) What is the periodic cost of the debt? (d) How much is the increase in the sinking fund in the 5th year? (e) What is the book value of the debt after 11 years? (a) The size of the periodic interest expense is $| (Round the final answer to the nearest dollar as needed. Round all intermediate values to six decimal places as needed.) (b) The size of the periodic payment is $ . (Round the final answer to the nearest dollar as needed. Round all intermediate values to six decimal places as needed.) (c) The size of the periodic cost is $ . (Round the final answer to the nearest dollar as needed. Round all intermediate values to six decimal places as needed.) (d) The increase is $ . (Round the final answer to the nearest dollar as needed. Round all intermediate values to six decimal places as needed.) (e) The book value is $
