To pay for remodeling, the company will take out a $500,000 five-year loan at 9.5% interest, compounded quarterly. The terms of the loan have been entered in the Loan Analysis worksheet. In cell B8, calculate the quarterly payment on the loan based on the loan conditions already entered. Complete the amortization schedule in cells B11 through E30. Column B contains the interest payment for each quarter, and column C contains the principal payment. Column D contains the remaining principal at the start of each month. The initial principal remaining is $500,000. The subsequent remaining principal values are reduced by the principal payment made in the previous quarter. Calculate the ending balance in cell D31. Use the IPMT function in cell B11 to calculate the interest amount paid per period. Copy this formula to cell B30. Use the PPMT function in cell C11 to calculate the principal amount paid per period. Copy this formula to cell C30. Write a formula in cell D11 to indicate the beginning balance of the loan. Write a formula in cell D12 to calculate the remaining balance after each payment (only adjust for the principal). Copy this formula down the column to cell D31.
To pay for remodeling, the company will take out a $500,000 five-year loan at 9.5% interest, compounded quarterly. The terms of the loan have been entered in the Loan Analysis worksheet. In cell B8, calculate the quarterly payment on the loan based on the loan conditions already entered. Complete the amortization schedule in cells B11 through E30. Column B contains the interest payment for each quarter, and column C contains the principal payment. Column D contains the remaining principal at the start of each month. The initial principal remaining is $500,000. The subsequent remaining principal values are reduced by the principal payment made in the previous quarter. Calculate the ending balance in cell D31. Use the IPMT function in cell B11 to calculate the interest amount paid per period. Copy this formula to cell B30. Use the PPMT function in cell C11 to calculate the principal amount paid per period. Copy this formula to cell C30. Write a formula in cell D11 to indicate the beginning balance of the loan. Write a formula in cell D12 to calculate the remaining balance after each payment (only adjust for the principal). Copy this formula down the column to cell D31.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
To pay for remodeling, the company will take out a $500,000 five-year loan at 9.5% interest, compounded quarterly. The terms of the loan have been entered in the Loan Analysis worksheet.
- In cell B8, calculate the quarterly payment on the loan based on the loan conditions already entered.
- Complete the amortization schedule in cells B11 through E30. Column B contains the interest payment for each quarter, and column C contains the principal payment. Column D contains the remaining principal at the start of each month. The initial principal remaining is $500,000. The subsequent remaining principal values are reduced by the principal payment made in the previous quarter. Calculate the ending balance in cell D31.
- Use the IPMT function in cell B11 to calculate the interest amount paid per period. Copy this formula to cell B30.
- Use the PPMT function in cell C11 to calculate the principal amount paid per period. Copy this formula to cell C30.
- Write a formula in cell D11 to indicate the beginning balance of the loan.
- Write a formula in cell D12 to calculate the remaining balance after each payment (only adjust for the principal). Copy this formula down the column to cell D31.
Transcribed Image Text:Amortization Table
Original Loan
$500,000
Annual Interest Rate
9.5%
Loan duration (yrs)
5.
Number of periods
4
per year
Ending Value of Loan
Quarterly Payment
Principal
Payment
Remaining
Principal
Period
Interest Payment
1.
3
4
5.
9.
8
11
12
13
and
14
15
17
18
20
Ending Balance
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 2 images
Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education