Delos borrowed 200 millios two years ago. The loan agreement, anamortizing loan, was for 5 years at 7.625% interest per annum. Delos has successfullycompleted two years of debt-service, but now wishes to renegotiate the terms of the loanwith the lender to reduce its ansual payments.a. What were Delos's annual principal and interest payments under the original loanagreement?

The amortization schedule helps to identify the interest and principal payments and the loan…

Answered: Delos borrowed 200 millios two years…

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter5: Introduction To Business Expenses

Section: Chapter Questions

Problem 61P

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Delos borrowed 200 million two years ago. The loan agreement, an amortizing loan, was for 5 years at 7625% interest per annum. Delos has saccessfully completed two years of debt-service, but now wishes to renegutiate the terms of the loan with the lender to reduce its ansual payments. a. What were Delos's annual principal and interest payments under the original loan agreement?
A borrower obtained a commercial loan for $4.5 million. The interest rate was fixed at 5.95% and had a 25-year amortization period. How much does the borrower still owe on the loan after making 38 payments, assume they never paid extra principal? In other words, assume that only the required payments were made.
Mr. Mamun borrowed Tk. 115,000 at a 12.5% annual rate of interest to be repaid over 5 years. The loan is amortized into five equal end-of-year payments. The loan has processing fees of 1.25%. Requirements: Calculate the annual end-of-year loan payment. Prepare a loan amortization schedule showing the interest and principal breakdown of each of the five loan payments. Explain why interest decreased gradually in this process?
Mr. Cruz borrowed P100,000 from BPI at a stated rate of 6% payable over a period of one-year. What is the effective interest rate if the loan is discounted?
Jacques has just been notified that the combined principal and interest on an amount he borrowed 19 months ago at 8.4% interest compounded monthly is now $2297.78 and must be repaid now that the loan contract is complete. a. What was the amount of the original loan? b. If someone purchased the loan contract after 8 months to yield interest at 7.9% compounded quarterly, what was the purchase price of the loan contract?
Dr Musonda is struggling to repay his loan of K600,000 with payments of K12,800made monthly in arrears for 5 years.After exactly one year, a loan company offers to “help” Dr Musonda by restructuring his loan with new monthly payments of K9,000 made in arrears.(i) Assuming the company charges the same APR as Dr Musonda’s original loan,calculate the term of the new loan.(ii) Calculate how much more interest in total Dr Musonda will pay on his restructured loan than on his original loan.
Acosta holdings borrowed P9000 from smith corporation on January1, 1998 and P12000 on January 1,2000.Acosta holdings made a partial payment of P7000 on January1, 2001.It was agreed that the balance of the loan would be amortized by two payments. One on January 1,2002 and one January 1,2003.The second being 50% larger than the first.If the interestrate is 12%, what is the amount of each payment?
Several years ago, a $ 2,000,000 fixed rate, monthly amortizing mortgage was issued for 20 years at 5.5% rate. The monthly payment is $13,758. 3.2% Prepayment penalty is applied to the loan balance. It is calculated at $34,130 Consider no origination costs for the loan. What is the loan balance at this time? How many payments have already been made? (use rounded number)
Louie borrowed $2,000 from Phil. Under this agreement, Louie would repay with $1,300 at t = 1 and $1,700 at t = 4 where time is given in years. Louie successfully made the payment in full at t = 1, but he faced some financial difficulty and was only able to pay 60% of what he owed at the time of the second payment. a. What was the annual interest rate (as a percent) for the original loan? b. What is Phil's annual yield (as a percent) for this four-year period?
Flat Rock Inc recently borrowed $55,000 from its bank at a simple interest rate of 9.2%. The loan is for one year and the loan agreement calls for the interest to be added to the amount borrowed and the total amount ot be repaid in monthly installments. (a) what are the loans monthly payments? (b) compute th loans APR and rEAR.
Joan Messineo borrowed $44,000 at a 6 percent annual interest rate to be repaid over three years. The loan is amortized into three equal annual end-of-year payments.a. Calculate the annual end-of-year loan payment.b. Prepare a loan amortization schedule showing the interest and principal breakdown of each of the three loan payments.c. Explain why the interest portion of each payment declines with the passage of time.
Rafael Sandino borrowed $23,000 on a 180-day, 11% note. After 80 days, Rafael paid $2,600 on the note. On day 120, Rafael paid an additional $4,600. Assume no further payments were made. Use ordinary interest. a.Determine the total interest paid during the life of the loan; use the U.S. Rule. (Do not round intermediate calculations. Roundyour answer to the nearest cent.) b.Determine the ending balance due (the payoff amount); use the U.S. Rule. (Do not round intermediate calculations. Roundyour answer to the nearest cent.)

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