Monthly PaymentDave Krug finances a new automobile by paying $5,800 cash and agreeing to make 30 monthlypayments of $440 each, the first payment to be made one month after the purchase. The loanbears interest at an annual rate of 12%. What is the cost of the automobile? (PV of $1, FV of $1, PVAof $1, and FVA of $1)$440Table Values are Based on:Note: Use appropriate factor(s) from the tables provided. Round "Table Factor" to 4 decimalplaces.Present Value of LoanniGII+OAnswer is not complete.Table Factor29.9599 X301%Cash DownPayment5,800TOTTPresent Value ofLoanCost of theAutomobile

Present Value (PV) represents the current value of a sum of money or a stream of cash flows that…

Answered: Dave Krug finances a new automobile by…

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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Dave Krug finances a new automobile by paying $7,300 cash and agreeing to make 30 monthly payments of $460 each, the first payment to be made one month after the purchase. The loan bears interest at an annual rate of 12%. What is the cost of the automobile? (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round "Table Factor" to 4 decimal places.) Monthly Payment Table Values are Based on: Present Value of Loan n i X = = + Table Factor Cash Down Payment = Present Value of Loan Cost of the Automobile
Crane Excavating Inc. is purchasing a bulldozer. The equipment has a price of $103,000. The manufacturer has offered a payment plan that would allow Crane to make 10 equal annual payments of $18,229.37, with the first payment due one year after the purchase. (a) How much total interest will Crane pay on this payment plan? (Round answer to 0 decimal places, e.g. 458,581.) Total interest
A logo design company purchases four new computers for $16,500. The company finances the cost of the computers for 3 years at an annual interest rate of 4.175% compounded monthly. Find the monthly payment (in dollars) for this loan. Round your answer to the nearest cent.
A design studio received a loan of $8,950 at 5.60% compounded semi-annually to purchase a camera. If they settled the loan in 2 years by making quarterly payments, construct the amortization schedule for the loan and answer the following questions: a. What was the payment size? Round to the nearest cent b. What was the size of the interest portion on the first payment? ← a acer SUBMIT QUESTION SAVE PROGRESS V SUBMIT ASSIC
Sheffield Excavating Inc. is purchasing a bulldozer. The equipment has a price of $93,800. The manufacturer has offered a payment plan that would allow Sheffield to make 10 equal annual payments of $18,700.00, with the first payment due one year after the purchase. How much total interest will Sheffield pay on this payment plan? (Round factor values to 5 decimal places, e.g. 1.25124 and final answer to 0 decimal places, e.g. 458,581.) Total interest $ Sheffieldcould borrow $93,800 from its bank to finance the purchase at an annual rate of 9%.Click here to view factor tablesShould Sheffield borrow from the bank or use the manufacturer’s payment plan to pay for the equipment? (Round factor values to 5 decimal places, e.g. 1.25124 and final answer to 0 decimal places, e.g. 7%.) Manufacturer's rate %
Dave Krug finances a new automobile by paying $6,800 cash and agreeing to make 40 monthly payments of $580 each, the first payment to be made one month after the purchase. The loan bears interest at an annual rate of 12%. What is the cost of the automobile? (PV of $1. EV of $1. PVA of $1. and EVA of $1) Note: Use appropriate factor(s) from the tables provided. Round "Table Factor" to 4 decimal places. Monthly Payment 580 Table Values are based on: Present Value of Loan n = Table Factor $ 40 12% Cash Down Payment 6,800 - Present Value of Loan Cost of the Automobile
The Odessa Supply Company is considering obtaining a loan from a sales finance company secured by inventories under a field warehousing arrangement. Odessa would be permitted to borrow up to $320,000 under such an arrangement at an annual interest rate of 10 percent. The additional cost of maintaining a field warehouse is $20,000 per year. Assume that there are 365 days per year. Determine the annual financing cost of a loan under this arrangement if Odessa borrows the following amounts: $320,000. Round your answer to two decimal places. % $240,000. Round your answer to two decimal places. %
prepare an amortization schedule showing the first four payments for each loan. Large semitrailer trucks cost $110,000 each. Ace Trucking buys such a truck and agrees to pay for it by a loan that will be amortized with 9 semiannual payments at 8% compounded semiannually.
LEW Company purchased a machine at a price of $100,000 by signing a note payable, which requires a single payment of $123,210 in two years. a. Assuming annual compounding of interest, what rate of interest is being paid on the loan? Use Excel function Rate to calculate the rate. b. What would be the purchase price of the machine had LEW negotiated a single payment of $120,000 in two years, using the same effective rate? Use excel only..
Apple has purchased land for $500,000 for their new factory. They make a down payment of $100,000, and the remainder is financed at (15) percent compounded semi-annually with semi-annual payments over 4 years. Develop an Excel® table to illustrate the payment amounts and schedule for the loan, assuming payback follows a) Plan 1: Pay the accumulated interest at the end of each interest period and repay the principal at the end of the loan period. b) Plan 2: Make equal principal payments, plus interest on the unpaid balance at the end of the period. c) Plan 3: Make equal end-of-period payments. d) Plan 4: Make a single payment of principal and interest at the end of the loan period. e) A different plan: Pay off the principal in such a way that it is X, 1.5X, 2X, 2.5X... till the end of the last payment period. In addition, pay the accumulated interest at the end of each interest period.
Goran plans to buy a used truck that costs $15,000. The dealer requires a 20% down payment. The rest of the cost is financed with a 3-year, fixed-rate amortized auto loan at 5.5% annual interest with monthly payments. Complete the parts below. Do not round any intermediate computations. Round your final answers to the nearest cent if necessary. If necessary, refer to the list of financial formulas.
Use either the tables from Appendix E in your textbook or a financial calculator for this question. Libby Company purchased equipment by paying $5,000 cash on the purchase date and agreeing to pay $5,000 every six months during the next four years. The first payment is due six months after the purchase date. Libby's borrowing rate is 8%. The liability reported on the balance sheet as of the purchase date, after the initial $5,000 payment was made: Select the answer that is closest to (within $250 above or below) what you calculated. If an answer is more than $250 away from what you calculated, you should consider it incorrect. Group of answer choices A)$45,000 B)$33,664 C)$38,664 d)$40,000 e)None of the above

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