Your firm, Long Ma Salt Company, has taken out a bank loan for $2,000,000 at an interest rate of 6% and a maturity of 2 years. You will make 24 equal monthly payments at the end of each month, thus this is an amortized loan. Create an amortization table for this loan for only the first two (2) months.

Monthly Payment:

pmt =

Amortization table: Payment

Month Payment Interest of PrincipalPrincipal Balance

1

2

a. After one-year, Long Ma Salt Company wishes to prepay the loan. Remember, it has already made 12 monthly payments. Given that there are no pre-payment penalties, what is the remaining balance on the loan (payoff amount)? Remember, Long Ma has just 12 monthly payments remaining.