PROBLEM On January 1, 2019, Pons, Inc. issued a 296 installment note to Green Bank in...

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PROBLEM On January 1, 2019, Pons, Inc. issued a 296 installment note to Green Bank in the amount of 10,000. The not require a

TABLE 4 Present Value of an Ordinary Annuity of $1 (1 + PVA 1.09 1.5% 2.0% 2.5% 3.09 3:59 4.0% 4.5% 5.0% 5.5% 6.0% 1 0. 10 0.

TABLE 2 Present Value of $1. PV 70% 1.0% 1.5% 20% 2.5% 3.09 3.55 4.09 4.5% 5.0% 5.5% 60% 101010 0.48922 0.480w 0.97561 0.9708

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Answer 1

Answer #1

Compute Annual payment of Installment:

Annual payment = Amount of loan $\div$ PVAF(2%, 4 years) using table 4

= $190,000 $\div$ 3.80773

= $49,898.50

Annual payment $49,898.50 will be made each december 31.

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Answer 2

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PROBLEM On January 1, 2019, Pons, Inc. issued a 296 installment note to Green Bank in...

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