Question

Consider a 30 year loan for $129508 at an annual interest rate of 8%. If payments are made yearly, how many dollars of the 16th payment will go toward interest? Round your answer to the nearest dollar.

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Answer #1

Answer—Amount of interest on 16th Installment will be $ 7,977

Loan amount

$ 1,29,508.00

PV Factor

        11.257783

Annual instalment amount

$      11,503.86

Loan Statement

Year

Loan amount balance

Interest

Installment

Ending balance

                                1

$ 1,29,508.00

$        10,360.64

$ (11,503.86)

$       1,28,364.78

                                2

$ 1,28,364.78

$        10,269.18

$ (11,503.86)

$       1,27,130.10

                                3

$ 1,27,130.10

$        10,170.41

$ (11,503.86)

$       1,25,796.64

                                4

$ 1,25,796.64

$        10,063.73

$ (11,503.86)

$       1,24,356.51

                                5

$ 1,24,356.51

$           9,948.52

$ (11,503.86)

$       1,22,801.17

                                6

$ 1,22,801.17

$           9,824.09

$ (11,503.86)

$       1,21,121.40

                                7

$ 1,21,121.40

$           9,689.71

$ (11,503.86)

$       1,19,307.24

                                8

$ 1,19,307.24

$           9,544.58

$ (11,503.86)

$       1,17,347.96

                                9

$ 1,17,347.96

$           9,387.84

$ (11,503.86)

$       1,15,231.93

                              10

$ 1,15,231.93

$           9,218.55

$ (11,503.86)

$       1,12,946.63

                              11

$ 1,12,946.63

$           9,035.73

$ (11,503.86)

$       1,10,478.49

                              12

$ 1,10,478.49

$           8,838.28

$ (11,503.86)

$       1,07,812.91

                              13

$ 1,07,812.91

$           8,625.03

$ (11,503.86)

$       1,04,934.08

                              14

$ 1,04,934.08

$           8,394.73

$ (11,503.86)

$       1,01,824.94

                              15

$ 1,01,824.94

$           8,146.00

$ (11,503.86)

$           98,467.07

                              16

$      98,467.07

$           7,877.37

$ (11,503.86)

$           94,840.57

                              17

$      94,840.57

$           7,587.25

$ (11,503.86)

$           90,923.96

                              18

$      90,923.96

$           7,273.92

$ (11,503.86)

$           86,694.01

                              19

$      86,694.01

$           6,935.52

$ (11,503.86)

$           82,125.67

                              20

$      82,125.67

$           6,570.05

$ (11,503.86)

$           77,191.86

                              21

$      77,191.86

$           6,175.35

$ (11,503.86)

$           71,863.34

                              22

$      71,863.34

$           5,749.07

$ (11,503.86)

$           66,108.55

                              23

$      66,108.55

$           5,288.68

$ (11,503.86)

$           59,893.37

                              24

$      59,893.37

$           4,791.47

$ (11,503.86)

$           53,180.98

                              25

$      53,180.98

$           4,254.48

$ (11,503.86)

$           45,931.59

                              26

$      45,931.59

$           3,674.53

$ (11,503.86)

$           38,102.25

                              27

$      38,102.25

$           3,048.18

$ (11,503.86)

$           29,646.57

                              28

$      29,646.57

$           2,371.73

$ (11,503.86)

$           20,514.43

                              29

$      20,514.43

$           1,641.15

$ (11,503.86)

$           10,651.73

                              30

$      10,651.73

$              852.14

$ (11,503.86)

$                          -  

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