A couple has decided to purchase a $90000 house using a down payment of $18000. They can amortize the balance at 11% over20 years.a) What is their monthly payment?Answer= $b) What is the total interest paid?Answer $c) What is the equity after 5 yeare?Answer = $d) What is the equity after 15 years?Answer = $

Amortization is a strategy used in accounting to reduce the book value of a loan or intangible asset…

Answered: A couple has decided to purchase a…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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A couple wishes to borrow money using the equity in their home for collateral. A loan company will loan them up to 70% of their equity. They puchased their home 10 years ago for $61,760. The home was financed by paying 20% down and signing a 30-year mortgage at 8.1% on the unpaid balance. Equal monthly payments were made to amortize the loan over the 30-year period. The net market value of the house is now $100,000. After making their 120th payment, they applied to the loan company for the maximum loan. How much (to the nearest dollar) will they receive?
9. Jason bought a home in Arlington, Texas, for $127,000. He put down 25% and obtained a mortgage for 30 years at 6%. a. What is Jason’s monthly payment? (Do not round intermediate calculations. Round your answer to the nearest cent.) Monthly payment $ b. What is the total interest cost of the loan? (Use the amortization worksheet on the financial calculator.) Total interest cost $
K (Annuity payments) Emily Morrison purchased a new house for $180,000. She paid $60,000 upfront and agreed to pay the rest over the next 10 years in 10 equal annual payments that include principal payments plus 9 percent compound interest on the unpaid balance. What will these equal payments be? a. Emily Morrison purchased a new house for $180,000 and paid $60,000 upfront. How much does she need to borrow to purchase the house?
You just received an inheritance of $123,456. How long would you need to leave it in an RRSP earning 2.5% compounded semi-annually to earn $800 (end of) monthly for 20 years? Assume the same RRSP interest rates for the payment stage as the deferred stage. Hint: There are two stages here. a) Draw a timeline HERE. Comments b) Describe how you will solve this problem in one or two sentences. Work c) How long would you need to leave it in an RRSP earning 2.5% compounded semi-annually to earn $800 (end of) monthly for 20 years? Work SETTING ON PMT PV CALCULATOR BGN or END P/Y C/Y
A couple wishes to borrow money using the equity in their home for collateral. A loan company will loan them up to 70% of their equity. They puchased their home 9 years ago for $64,386. The home was financed by paying 10% down and signing a 30-year mortgage at 9.6% on the unpaid balance. Equal monthly payments were made to amortize the loan over the 30-year period. The net market value of the house is now $100,000. After making their 108th payment, they applied to the loan company for the maximum loan. How much (to the nearest dollar) will they receive? Amount of loan: $ (Round to the nearest dollar.)
Margaret Foster wants to buy a new camper in 6 years. She estimates the camper will cost $6,400. Assume Margaret invests $3,800 now at 8% interest compounded semiannually. Will Margaret have enough to buy her camper at the end of 6 years? Calculate the amount she is short or over what is needed.
A couple want to buy a house that costs $542 000. They pay a 20% deposit and borrow the rest of the money as a reducing balance loan for 25 years at 8.25% per annum with interest calculated and repayments made monthly. Determine the monthly repayment.
If George wants to purchase a new home for $400,000 and finance $320,000 with a 4%, 30 year mortgage with a monthly payment of 12,697.43. How much interest would be paid in the first 12th payment? A.) 1,049.47 B.)1,504.45 C.) 1,240.67 D.) 1,120.67
A retired couple buys a new recreational vehicle (RV) for $42,000.00. They make a down payment of $13,000.00 and finance the balance at 9.0% APR over 60 months. Their monthly payment is $601.99. Instead of making the 12th payment, the couple decides to pay the remaining balance on the loan. Use the actuarial method to determine how much interest the couple will save. If you use the Finance Charge Table 11.2, page 632, and the "unearned interest formula", page 635, in your textbook to solve this problem, the result will match exactly with one of the answers. If you use a spreadsheet to do the computation, your result will not match exactly with any of the answers, but it will differ only very little (mostly less than $1) from the "correct" answer. O $4,650.28 O $4,705.06 $5,620.19 $6,814.22
C. Assume Ron and his wife Julie, two young professionals, just bought a house for $600,000. They made a $100,000 down payment and borrowed the remainder at 4.25% fixed interest compounded monthly for 30 years. What will be Ron and Julie's monthly house payment on this amortizing loan?
Today, Julie borrowed $5000 to purchase furniture for her new house. She can repay the loan in either of the two ways described below. (a) Five equal annual installments with interest determined at 5% per year. (b) One payment 3 years from now with interest determined at 7% per year. Show how to solve for each option, and please show how you solved it mathematically
Bill and Kim Johnson are purchasing a house for $252,000. Their Bank requires them to pay a 20% down payment. The current mortgage rate is 10%, and they are required to pay one point at the time of closing. Determine the total amount Bill and Kim will pay for their house, including principal, interest, down payment, and points (do not include taxes and homeowners' insurance) for the following lengths of their mortgage. a) 10 years b) 20 years c) 30 years

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