A man paid 10% down payment of P1,500,000 for a house and lot this month of January. The rate of interest is 15% compounded semi-annually. He agrees to pay after 3 months his balance on a 6 monthly installment. Compute for the following. (1) Effective Interest C = K = ieff =

A man paid 10% down payment of P1,500,000 for a house and lot this month of January. The rate of interest is 15% compounded semi-annually. He agrees to pay after 3 months his balance on a 6 monthly installment. Compute for the following. (1) Effective Interest C = K = ieff =

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 1EA: Halep Inc. borrowed $30,000 from Davis Bank and signed a 4-year note payable stating the interest...

See similar textbooks

Related questions

Q: A man paid 10% down payment of P2, 000,000 for a house and lot. If the rate of interest is 15%…

A: PRESENT VALUE Present value, also known as present discounted value, is the value of an expected…

Q: 3. Don Magellan borrowed today from Ginoong Lapulapu P300,000.00 and agreed to repay the loan with 4…

A: Loan amount (PV) = P300,000 Number of monthly payments (n) = 4 Interest rate = 12% Monthly interest…

Q: how much does he need to pay quarterly?

A: A stream of equal cash flows (CF) paid or received periodically is termed as annuity. Annuity due…

Q: 1. A fully secured loan of P30,000 was to be amortized by 10 equal semi-annual payments, the first…

A: As per the honor code, We’ll answer the first question since the exact one wasn’t specified. Please…

Q: You borrow $5,000 at 10% per year and will pay off the loan in 3 equal annual payments starting 1…

A: Principal = 5000 r = 10% period = 3 years after 1 year of taking loan payments = 2010.57 This annual…

Q: Assume you borrow $ 60,000 at 12% per year interest and you agree to repay the loan at 11 equal…

A: Loan is an agreement between lender and borrower where lender gives lump-sum money to borrower in…

Q: You are about to borrow $15,000 from a bank at an interest rate of 8% compounded annually. You are…

A: year opening Balance Total payment Interest Principal Repayment Closing Balance 0 15000…

Q: A man paid 10% down payment of P200,000 for a house and lot and agreed to pay the balance on monthly…

A: Given: Particulars Amount Down payment 200,000 Down payment rate 10% Monthly…

Q: a. Calculate the interest component of Payment 10. Interest $. 1187.03 b. Calculate the principal…

A: Loan amortization refers to a schedule which is prepared to shows the periodic loan payments, amount…

Q: A man borrowed P3 000 to be paid after 18 months with interest at 12% compounded semi-annually and…

A: Here, First borrowed amount payable in 18 months at 12% interest rate compounded semi annually is…

Q: Don Magellan borrowed today from Ginoong Lapulapu P300,000.00 and agreed to repay the loan with 4…

A: Here, To Find: Equal monthly payments =?

Q: A businessman borrowed P220,000 with interest at the rate of 4.2% compounded semi-annually. He…

A: The future value of money is the amount of money that will be worth at some point in the future if…

Q: A man secured a P 9,556 loan at 2 % interest rate. Find the annual amortization to extinguish it in…

A: Given information: Loan amount is 9,556 Interest rate is 2% Number of years is 3

Q: You have taken a loan of $92,000.00 for 35 years at a 4.9% annual interest rate, with interest…

A: Annual payments are made to service the loan. But the interest rate is compounded quarterly. We can…

Q: 1. Mary made a loan of P58,000 to supply her new business. It is to be amortized by ten equal…

A: We need to use RATE function in excel to calculate interest rate. Formula is =RATE(NPER,-PMT,PV)

Q: A man borrowed K6,000 a 7% and agrees to pay back by making equal payments at end of every month for…

A: Amortization schedule: A table that details the regular payments for an amortizing debt is called an…

Q: A man paid a 10% downpayment of P 200,000 for a house and lot and agreed to pay the balance on…

A: Monthly Installment: an installment loan in which payments are paid at predetermined intervals; the…

Q: Bradley received a loan of $32,000 at 4.75% compounded quarterly. She had to make payments at the…

A: The amortization schedule refers to the recording of the payments made for the repayment of the loan…

Q: Q) You are about to borrow $15,000 from a bank at an interest rate of 8% compounded annually. You…

A: Given data; Loan amount =$ 15,000 rate of interest = 8% Annual repayment = $ 5820.5 Lets calculate…

Q: A man paid 10% down payment of P1,500,000 for a house and lot this month of January. The rate of…

A: The present value of the loan is equal to the sum of the present values of all the future…

Q: 1. Mr. M. Rogue obtains a loan of P60,000.00 to be paid by equal periodic payment at the end of each…

A: The periodic payment is calculated by dividing the loan amount from the present value factor. It…

Q: You are about to borrow $15,000 from a bank at an interest rate of 8% compounded annually. You are…

A: Year 1: Borrowed amount at the beginning of Year 1 = $15000 Note: No intermediate rounding is done,…

Q: a. Find the amount borrowed by this person. b. How much does this credit worth at the end of the…

A: Given, A = 8000 r = 12% nominal monthly rate = 12%/12 = 1% n = 10*12 = 120

Q: A man secured aP 7,407 loan at 2 % interest rate. Find the annual amortization to extinguish it in 3…

A: Amortization: It is the re-payment of the loan amount over the loan period.

Q: castor borrowed today from Chuchu P100,000.00 and agreed to repay the loan with 3 equal monthly…

A: Time value of money :— According to this concept, the value of money in present day is greater than…

Q: A man owes Php 15,000 with interest at 8% payable semi-annually. Equal payments at the beginning of…

A: Firstly we shall calculate the Semiannual payment using Excel's =PMT formula Then we shall prepare…

Q: A family has an $80,000, 20-year loan at 8% compounded monthly. (a) if the monthly payment is…

A: A loan is an amount of borrowing that an individual or a corporation has taken from a bank or a…

Q: 1. A man paid 10% down payment of P1,000,000 for a house and lot this month of January. The rate of…

A: The present value of loan is equal to the sum of the present values of all future monthly…

Q: $10,000 is borrowed at 10% a year interest for five years. At the end of each year, the borrower…

A: Computation:

Q: If you borrow $5,300 at $900 interest for one year, what is your annual interest cost for the…

A: The effective rate is calculated with the effect of compounding of interest for the frequency given…

Q: -. Castor borrowed today from ChuChu P100,000.00 and agreed to repay the loan with 3 equal monthly…

A: Monthly Payment is calculated using Financial Calculator PV = -100,000 I/Y = 12%/12 = 1% N = 3…

Q: Monthly payments are required on a $45,000 loan at 6.0% compounded monthly. The loan has an…

A: Since you have posted a question with multiple sub-parts, we will solve first three sub-parts for…

Question

(1) Effective Interest

C =

K =

ieff =

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Given:

VIEW

Calculation of Effective Interest Rate:

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

Marathon Peanuts converts a $130,000 account payable into a short-term note payable, with an annual interest rate of 6%, and payable in four months. How much interest will Marathon Peanuts owe at the end of four months? A. $2,600 B. $7,800 C. $137,800 D. $132,600
Halep Inc. borrowed $30,000 from Davis Bank and signed a 4-year note payable stating the interest rate was 4% compounded annually. Halep Inc. will make payments of $8,264.70 at the end of each year. Prepare an amortization table showing the principal and interest in each payment.
If Bergen Air Systems takes out a $100,000 loan, with eight equal principal payments due over the next eight years, how much will be accounted for as a current portion of a noncurrent note payable each year?
Sharapovich Inc. borrowed $50,000 from Kerber Bank and signed a 5-year note payable stating the interest rate was 5% compounded annually. Sharapovich Inc. will make payments of $11,548.74 at the end of each year. Prepare an amortization table showing the principal and interest in each payment.
Calculating and comparing add-on and simple interest loans. Eli Nelson is borrowing 10,000 for five years at 7 percent. Payments, which are made on a monthly basis, are determined using the add-on method. a. How much total interest will Eli pay on the loan if it is held for the full five-year term? b. What are Elis monthly payments? c. How much higher are the monthly payments under the add-on method than under the simple interest method?
A man paid 10% down payment of P1,500,000 for a house and lot this month of January. The rate of interest is 15% compounded semi-annually. He agrees to pay after 3 months his balance on a 6 monthly installment. Compute for the following. (1) Effective Interest C = K = leff (4 decimal places) = (2) Amount of the Monthly Installment =
Anna received a loan of $29,000 at 4.5% compounded semi-annually. He had to make payments at the end of every half-year for a period of 6 years to settle the loan. a. Calculate the size of payments. Round to the nearest cent b. Fill in the partial amortization schedule for the loan, rounding your answers to two decimal places. Payment Number 0 Payment Interest Portion Principal Portion Principal Balance $29,000.00
castor borrowed today from Chuchu P100,000.00 and agreed to repay the loan with 3 equal monthly amounts, the first payment to start 1 month from today. How much is the value of the monthly payment? construct an amortization schedule. Interest is 12%compounded monthly.
Jesse received a loan of $36,000 at 5.75% coumpounded quarterly. She had to make payments at the end of every quarter for a period of 5 years to settle the loan. a. Calculate the size of payments Round to the nearest cent b. Fill in the partial amortization schedule for the loan, rounding your answers to two decimal places Payment Number Payment Interest Portions Principal Portion Principal Balance
3. Ruby Red borrowed $7500 for the diner at 8.1% compounded monthly. She agreed to repay the loan in equal monthly payments over four years. 1. What is the size of the monthly payment? 2. How much of the 15th payment is interest? 3. What is the principal repaid in the 36th payment period? 4. Prepare a partial amortization schedule.
4. Castor borrowed today from ChuChu P100,000.00 and agreed to repay the loan with 3 equal monthly amounts, the first payment to start 1 month from today. How much is the value of the monthly payment? Construct an amortization schedule. Interest is 12 % compounded monthly.
Leah received a loan of $35,000 at 3,5% compounded quarterly. She had to make payments at the end of every quarter for a period of 7 years to settle the loan. a. Calculate the size of payments. Round to the nearest cent b. Fill in the partial amortization schedule for the loan, rounding your answers to two decimal places. Payment Number Payment Interest Portion Principal Portion Principal Balance $35.000.00