Answer:
Installment Note Schedule:
Period Beginning Balance Interest Principal Ending Balance
1. Year #1 $666,633.00 $46,664.31 $93,192.49 $573,440.51
2. Year #1 $573,440.51 $40,140.84 $99,715.97 $473,724.54
3. Year #2 $473,724.54 $33,160.72 $106,696.09 $367,028.45
4. Year #2 $367,028.45 $25,691.99 $114,164.81 $252,863.64
5. Year #3 $252,863.64 $17,700.45 $122,156.35 $130,707.29
6. Year #3 $130,707.29 $9,149.51 $130,707.29 $0.00
Explanation:
a) Data and Calculations:
Cost of equipment = $666,633
Rate of interest = 14%
Payment terms = semiannual payments over three years
Payment for each period = $139,857
Loan Amount $666,633
Loan Term 3 years 0 months
Interest Rate 14
Compound Semi-annually
Pay Back Every 6 Months
Results:
Payment Every 6 Months = $139,856.80 = $139,857 approx.
Total of 6 Payments = $839,140.82
Total Interest = $172,507.82
