Crosetti's Electronics issues an $800,000, 8%, 10-year mortgage note on Dec 31, 2022,to help finance a plant expansion program. The terms of the note provide for annualinstallment payments of $119,224 each Dec 31.This problem directly applies to YOU if you have any "monthly payments" from a credit card, carloan or a mortgage. Ex: You owe $1,000 on your credit card at 19% interest. You always paythe "minimum monthly payment" of 2% ... $20 per month.Use this Debt Repayment Calculator to answer "How long willit take you to pay off this credit card?or copy/paste this link:https://www.myfinancialgoals.org/credit-card-minimum-payment-calculator?source=8552352600&network=g&campaign=957905197&adgroup=61464639320&matchtype=&keyword=&device=c&creative=324240436707&gclid=EAlal QobChMlornm24-e9g|Vph6tBh2VMAyoEAAYAiAAEgJjdvD BwEAnswer??Instructions (Round all computations to the nearest dollar.)(a) Prepare an "installment payments schedule" for the first four payments of themortgage payableAnnualInterestPeriodIssue Date1234CashPayment119,224119,224119,224119,224InterestExpenseInterest Expense = (Principal Bal x 8%)Reduction ofPrincipalIssue date 1)Issue date 1) Reduction of Principal(Cash Pxmt - Int Exp)Issue date 1) Principal Balance = (Previous Principle Reduction of Principal)PrincipalBalance800,000

Particulars Values Mortgage note $ 8,00,000 Interest rate 8% Number of years 10 Annual…

a) Prepare an "installment payments schedule" for the first four payments of the mortgage payable Annual Interest Period Issue Date 1 2 3 4 Cash Payment 119,224 119,224 119,224 119,224 Interest Expense Reduction of Principal Issue date 1) Interest Expense = (Principal Bal x 8%) Issue date 1) Reduction of Principal = (Cash Pmt - Int Exp) Issue date 1) Principal Balance = (Previous Principle Reduction of Principal) Principal Balance 800,000

a) Prepare an "installment payments schedule" for the first four payments of the mortgage payable Annual Interest Period Issue Date 1 2 3 4 Cash Payment 119,224 119,224 119,224 119,224 Interest Expense Reduction of Principal Issue date 1) Interest Expense = (Principal Bal x 8%) Issue date 1) Reduction of Principal = (Cash Pmt - Int Exp) Issue date 1) Principal Balance = (Previous Principle Reduction of Principal) Principal Balance 800,000

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter16: Working Capital Policy And Short-term Financing

Section: Chapter Questions

Problem 14P

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Question

Crosetti's Electronics issues an $800,000, 8%, 10-year mortgage note on Dec 31, 2022,
to help finance a plant expansion program. The terms of the note provide for annual
installment payments of $119,224 each Dec 31.
This problem directly applies to YOU if you have any "monthly payments" from a credit card, car
loan or a mortgage. Ex: You owe $1,000 on your credit card at 19% interest. You always pay
the "minimum monthly payment" of 2% ... $20 per month.
Use this Debt Repayment Calculator to answer "How long will
it take you to pay off this credit card?
or copy/paste this link:
https://www.myfinancialgoals.org/credit-card-minimum-payment-
calculator?source=8552352600&network=g&campaign=957905197&adgroup=6146463
9320&matchtype=&keyword=&device=c&creative=324240436707&gclid=EAlal QobChM
lornm24-e9g|Vph6tBh2VMAyoEAAYAiAAEgJjdvD BwE
Answer??
Instructions (Round all computations to the nearest dollar.)
(a) Prepare an "installment payments schedule" for the first four payments of the
mortgage payable
Annual
Interest
Period
Issue Date
1
2
3
4
Cash
Payment
119,224
119,224
119,224
119,224
Interest
Expense
Interest Expense = (Principal Bal x 8%)
Reduction of
Principal
Issue date 1)
Issue date 1) Reduction of Principal
(Cash Pxmt - Int Exp)
Issue date 1) Principal Balance = (Previous Principle Reduction of Principal)
Principal
Balance
800,000

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