How do we calculate annual payments when given balloon payment at the end as is the case here?
Homework Answers
Initial vehicle deposit: $8,300.00
Loan payments: $82,924.14
Balloon payment at end: $13,000.00
Total payable: $104,224.14
30 monthly payments of: $2,764.14
Total interest: $21,224.14
83000-8300 = Monthly Payment x Discount Factor of 30 months, interest 18% pa + 13000 x Discount Factor of 30th month, interest 18% pa
74700 = Monthly Payment x 24.0132 +13000 x 0.6403
74700 = Monthly Payment x 24.0132 + 8324
74700 - 8324 = Monthly Payment x 24.0132
66376 / 24.0132 = Monthly Payment
Monthly Payment = 2764.14
*Discount Factor of 30 months = {[(1 + Discount Rate ) ^Period ] - 1} / [Discount Rate(1 + Discount Rate)^Period]
={[1+0.18/12)^30]-1}/[0.18/12(1+0.18/12)^30] = (1.5631-1)/0.2345 = 24.0132
**Discount Factor of 30th month = 1 / (1 x (1 + Discount Rate) ^ Period Number)
= 1/ (1 x(1+0.18/12)^30) = 1/1.5631 = 0.6403
Add Answer to:
How do we calculate annual payments when given balloon
payment at the end as is the...
Problem Set 1. A man is paying off a debt of $15,000 with regular payments of...
Problem Set 1. A man is paying off a debt of $15,000 with regular payments of $300 at the end of each month. Annual interest is 18% compounded monthly. (a) Find the exact amount of time to at least five decimal places that it will take to pay off this loan. (b) Determine the size of the balloon payment to be made to pay off the loan at the time of the last regular payment. (c) Determine the size of...
Stanley has been operating as a sole trader for many years with a year end of...
Stanley has been operating as a sole trader for many years with a year end of 31 December. He is preparing a cash budget and provides the following information for the three-month period from July 2019 to September 2019 1 Total income of $120 000 from trade receivables for credit sales will be collected in equal amounts over the three-month period. 2 Cash sales are expected to be 25% of the cash collected each month from credit sales. There will...
Calculate all of the problems in the document below in an Excel spreadsheet or on a...
Calculate all of the problems in the document below in an Excel spreadsheet or on a financial calculator. Please show your work in order to get credit. For each problem, state the inputs given, what you are being asked to find (the missing input), and then use the Finance function to get the correct answer (if using Excel). 1. If you wish to accumulate $100,000 in 5 years, how much must you deposit today in an account that pays an...
If you invest $17,500 per year for 17 years (all payments made at the beginning of each year)
Calculate all of the problems in the document below in an Excel spreadsheet or on a financial calculator. Please show your work in order to get credit. For each problem, state the inputs given, what you are being asked to find (the missing input), and then use the Finance function to get the correct answer (if using Excel).17. If you invest $17,500 per year for 17 years (all payments made at the beginning of each year), you will have accumulated...
3) Determine the value at the end of 3 years o certificate of deposit (CD) that...
3) Determine the value at the end of 3 years o certificate of deposit (CD) that pays a nominal annua pays a nominal annual interest rate of 8% co a) Quarterly b) Monthly f s3,500. If he only pays the APR of 12% on credit 4 Phillip has a credit card payment balance outstanding o minimum balance of $50 each month, and the credit card charges an card balances, how long will it take for Phillip to pay off his...
Cash flow analysis (Appendix11.1) (CMA, adapted) 11.38 TabComp Ltd is a retail distributor for MZB-33 computer...
Cash flow analysis (Appendix11.1) (CMA, adapted) 11.38 TabComp Ltd is a retail distributor for MZB-33 computer hardware, and related software and support services. TabComp prepares annual sales forecasts of which the first six months for 2018 are presented here. Cash sales account for 25% of TabComp's total sales, 30% of the total sales are paid by bank credit card and the remaining 45% are on open account (TabComp's own charge accounts). The cash sales and cash from bank credit card...
What is an annuity? Select one: a. present worth of a series of equal payments. b....
What is an annuity? Select one: a. present worth of a series of equal payments. b. a single payment. c. a series of payments that changes by a constant amount from one period to the next. d. a series of equal payments over a sequence of equal periods. e. a series of payments that changes by the same proportion from one period to the next. Question 2 The present worth factor Select one: a. gives the future value equivalent to...
Total Loan amount: The total mortgage loan amount is the amount you borrow after paying your down payment. Here, we assumed that you would pay 20% of the home value (property value) as a down payment. 2. Months: The mortgage payment period is set to 30 ye
Total Loan amount: The total mortgage loan amount is the amount you borrow after paying your down payment. Here, we assumed that you would pay 20% of the home value (property value) as a down payment. 2. Months: The mortgage payment period is set to 30 years. In terms of months, this is equivalent to 30 years multiplied by 12 months. We put our primary basis of payments in terms of months, which is why we need to convert everything...
14. What is the interest rate of a 4-year, annual $1,000 annuity with present value of...
14. What is the interest rate of a 4-year, annual $1,000 annuity with present value of $3,500? A. 3.85 percent B. 5.56 percent C. 8.84 percent D. 9.70 percent 15. You wish to buy a $15,000 car. The dealer offers you a 4-year loan with a 9 percent APR What are the monthly payments? A. $260.78 B. $312.50 C. $373.28 D. $3,820.56 16. You are planning to make monthly deposits of $330 into a retirement account that pays 8 percent...
On QUESTION 1(40 MARKS) The management accountant at Hawk Electronics Company, Robert Richie, is wwk Electronics...
On QUESTION 1(40 MARKS) The management accountant at Hawk Electronics Company, Robert Richie, is wwk Electronics Company, Robert Richie, is in the process of preparing the cash budget for the business for th e endine December 31, 2018. Extracts from the sales and purchases budgets are as follows: Month Cash Sales Purchases 2018 Sales On Account Account August $121,100 $480,000 $390,000 September $165,500 $600,000 $360,000 October $131,400 $700,000 $480,000 November $167,350 $650,000 $400,000 December $156,200 $800,000 $500,000 (i) An analysis...
Problem Set 1. A man is paying off a debt of $15,000 with regular payments of $300 at the end of each month. Annual interest is 18% compounded monthly. (a) Find the exact amount of time to at least five decimal places that it will take to pay off this loan. (b) Determine the size of the balloon payment to be made to pay off the loan at the time of the last regular payment. (c) Determine the size of...
Stanley has been operating as a sole trader for many years with a year end of 31 December. He is preparing a cash budget and provides the following information for the three-month period from July 2019 to September 2019 1 Total income of $120 000 from trade receivables for credit sales will be collected in equal amounts over the three-month period. 2 Cash sales are expected to be 25% of the cash collected each month from credit sales. There will...
3) Determine the value at the end of 3 years o certificate of deposit (CD) that pays a nominal annua pays a nominal annual interest rate of 8% co a) Quarterly b) Monthly f s3,500. If he only pays the APR of 12% on credit 4 Phillip has a credit card payment balance outstanding o minimum balance of $50 each month, and the credit card charges an card balances, how long will it take for Phillip to pay off his...
Cash flow analysis (Appendix11.1) (CMA, adapted) 11.38 TabComp Ltd is a retail distributor for MZB-33 computer hardware, and related software and support services. TabComp prepares annual sales forecasts of which the first six months for 2018 are presented here. Cash sales account for 25% of TabComp's total sales, 30% of the total sales are paid by bank credit card and the remaining 45% are on open account (TabComp's own charge accounts). The cash sales and cash from bank credit card...
14. What is the interest rate of a 4-year, annual $1,000 annuity with present value of $3,500? A. 3.85 percent B. 5.56 percent C. 8.84 percent D. 9.70 percent 15. You wish to buy a $15,000 car. The dealer offers you a 4-year loan with a 9 percent APR What are the monthly payments? A. $260.78 B. $312.50 C. $373.28 D. $3,820.56 16. You are planning to make monthly deposits of $330 into a retirement account that pays 8 percent...
On QUESTION 1(40 MARKS) The management accountant at Hawk Electronics Company, Robert Richie, is wwk Electronics Company, Robert Richie, is in the process of preparing the cash budget for the business for th e endine December 31, 2018. Extracts from the sales and purchases budgets are as follows: Month Cash Sales Purchases 2018 Sales On Account Account August $121,100 $480,000 $390,000 September $165,500 $600,000 $360,000 October $131,400 $700,000 $480,000 November $167,350 $650,000 $400,000 December $156,200 $800,000 $500,000 (i) An analysis...
Most questions answered within 3 hours.
-
The blues made its way into many kinds of music. Eric Clapton,
The Beatles, and Elvis...
asked 7 minutes ago -
If you’re standing at the bottom of a hill and asked to evaluate
it while being...
asked 1 hour ago -
1. Which region has taken the lead in the world of
e-waste handling?
a) European Union...
asked 56 minutes ago -
A 8.15- g bullet from a 9-mm pistol has a velocity of 366.0 m/s.
It strikes...
asked 2 hours ago -
The outstanding bonds of Alpha Extracts have a yield to maturity
of 7.4 percent and a...
asked 2 hours ago -
The Problem: The Case of the Harmonizing Vacations
Your CEO is exploring partnering with a European...
asked 3 hours ago -
A chemical equation is balanced by adding coefficients in front
of some formulas so that the...
asked 3 hours ago -
From the literature (reference your sources): What are the
lattice parameters of calcite and aragonite? Why...
asked 4 hours ago -
Your system is rejecting the question am asking which is
preceded by a case study. It...
asked 4 hours ago -
3. On January 2, 2000, Larry creates a trust with himself as
trustee. Larry as trustee...
asked 4 hours ago -
A member of the volleyball team spikes the ball. During this
process, she changes the velocity...
asked 4 hours ago -
Are adult gamers less likely to use a gaming console (Xbox,
PlayStation, Wii, etc...) than teen...
asked 5 hours ago