Company A borrows P2,000,000 from Bank at 12% interest to be paid at the end of each year for 15 years. Find for the annual total payments under (a) equal annual amortization (b) equal principal payment methods. Construct a complete amortization schedule (as shown below) for each scheme. Year Outstanding Balance Principal Payment Interest Payment Total Payment 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Company A borrows P2,000,000 from Bank at 12% interest to be paid at the end of each year for 15 years. Find for the annual total payments under (a) equal annual amortization (b) equal principal payment methods. Construct a complete amortization schedule (as shown below) for each scheme. Year Outstanding Balance Principal Payment Interest Payment Total Payment 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter19: Lease And Intermediate-term Financing

Section: Chapter Questions

Problem 17P

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