Question

The LBB Company recently took a mortgage on a property for $100,000. The interest is 12% and the monthly payment is $1,020. Prepare the first four months of the amortization table.

Payment Number Payment Interest Expense Principal Reduction Balance

Answer 1

First four months of the amortization table:
Payment Number	Payment	Interest Expense	Principal reduction	Balance
	a	b=Beginning Balance*12%*1/12	c=a-b	d
0				$ 1,00,000.00
1	$ 1,020.00	$        1,000.00	$         20.00	$     99,980.00
2	$ 1,020.00	$           999.80	$         20.20	$     99,959.80
3	$ 1,020.00	$           999.60	$         20.40	$     99,939.40
4	$ 1,020.00	$           999.39	$         20.61	$     99,918.79