Question

Locust Inc. owes ​$20,000.00 to be repaid by monthly payments of ​$460.00. Interest is 11​% compounded monthly.

​(a)	How many payments will Locust Inc. have to​ make?
​(b)	How much interest is included in the 17th payment?
​(c)	How much of the principal will be repaid in the 15th payment​ period?
​(d)	Construct a partial amortization schedule showing details of the first three​ payments, the last three​ payments, and totals.

Answer 1

1.
Total number of payments is 46

2.
Interest in 17th payment is 139.84

3.
Principal in 15th payment is 314.37

4.

Payment	Loan beginning balance	Payment	Interest payment	Principal payment	Loan ending balance
1	20000.00	460.00	183.33	276.67	19723.33
2	19723.33	460.00	180.80	279.20	19444.13
3	19444.13	460.00	178.24	281.76	19162.37
4	19162.37	460.00	175.66	284.34	18878.02
5	18878.02	460.00	173.05	286.95	18591.07
6	18591.07	460.00	170.42	289.58	18301.49
7	18301.49	460.00	167.76	292.24	18009.25
8	18009.25	460.00	165.08	294.92	17714.34
9	17714.34	460.00	162.38	297.62	17416.72
10	17416.72	460.00	159.65	300.35	17116.37
11	17116.37	460.00	156.90	303.10	16813.27
12	16813.27	460.00	154.12	305.88	16507.40
13	16507.40	460.00	151.32	308.68	16198.71
14	16198.71	460.00	148.49	311.51	15887.20
15	15887.20	460.00	145.63	314.37	15572.83
16	15572.83	460.00	142.75	317.25	15255.58
17	15255.58	460.00	139.84	320.16	14935.43
18	14935.43	460.00	136.91	323.09	14612.34
19	14612.34	460.00	133.95	326.05	14286.28
20	14286.28	460.00	130.96	329.04	13957.24
21	13957.24	460.00	127.94	332.06	13625.18
22	13625.18	460.00	124.90	335.10	13290.08
23	13290.08	460.00	121.83	338.17	12951.90
24	12951.90	460.00	118.73	341.27	12610.63
25	12610.63	460.00	115.60	344.40	12266.23
26	12266.23	460.00	112.44	347.56	11918.67
27	11918.67	460.00	109.25	350.75	11567.92
28	11567.92	460.00	106.04	353.96	11213.96
29	11213.96	460.00	102.79	357.21	10856.76
30	10856.76	460.00	99.52	360.48	10496.28
31	10496.28	460.00	96.22	363.78	10132.49
32	10132.49	460.00	92.88	367.12	9765.37
33	9765.37	460.00	89.52	370.48	9394.89
34	9394.89	460.00	86.12	373.88	9021.01
35	9021.01	460.00	82.69	377.31	8643.70
36	8643.70	460.00	79.23	380.77	8262.94
37	8262.94	460.00	75.74	384.26	7878.68
38	7878.68	460.00	72.22	387.78	7490.90
39	7490.90	460.00	68.67	391.33	7099.57
40	7099.57	460.00	65.08	394.92	6704.65
41	6704.65	460.00	61.46	398.54	6306.11
42	6306.11	460.00	57.81	402.19	5903.91
43	5903.91	460.00	54.12	405.88	5498.03
44	5498.03	460.00	50.40	409.60	5088.43
45	5088.43	460.00	46.64	413.36	4675.07
46	4675.07	460.00	42.85	417.15	4257.93
47	4257.93	460.00	39.03	420.97	3836.96
48	3836.96	460.00	35.17	424.83	3412.13
49	3412.13	460.00	31.28	428.72	2983.41
50	2983.41	460.00	27.35	432.65	2550.76
51	2550.76	460.00	23.38	436.62	2114.14
52	2114.14	460.00	19.38	440.62	1673.52
53	1673.52	460.00	15.34	444.66	1228.86
54	1228.86	460.00	11.26	448.74	780.12
55	780.12	460.00	7.15	452.85	327.28
56	327.28	330.28	3.00	327.28	0.00
TOTAL		25630.28	5630.28	20000.00