Question

Givens, Hong, and Partners obtained a $8600 term loan at 10.1% compounded annually for new boardroom furniture. Prepare a complete amortization schedule in which the loan is repaid by equal semiannual payments over three years. (Round your answers to the nearest cent. Do not round the intermediate calculations.)

Payment					Interest			Principal			Principal
number		Payment $			portion $			portion $			balance $
0			--			--			--			8600.00
1
2
3
4
5
6

Answer 1

rate positively ..

First we have to compute the semi-annual compounding rate
semi-annual compounding rate =		((1+10.1%)^0.5-1)*2
			9.86%
Computation of semi-annual installment
put in calculator
FV		0
PV		-8600
I	9.86%/2	4.9285%
N		6
Compute PMt		$1,690.48
Payment		Interest	Principal	Principal
number	Payment $	portion $	portion $	balance $
0				8,600.00
1	1,690.48	423.86	1,266.63	7,333.37
2	1,690.48	361.43	1,329.05	6,004.32
3	1,690.48	295.93	1,394.55	4,609.77
4	1,690.48	227.19	1,463.29	3,146.48
5	1,690.48	155.08	1,535.40	1,611.08
6	1,690.48	79.40	1,611.08	0.00