Question

In: Finance

An $8000 loan is to be amortized with equal monthly payments over a 2 year period...

An $8000 loan is to be amortized with equal monthly payments over a 2 year

period at j (12) = 8 %. Find the outstanding principal after 7 months and split the

8 th payment into principal and interest portions.

outstanding principal after 7 months is?

the principal in the 8 th payment is?

the interest in the 8 th payment is?

Expert Solution

Calculating Monthly Payment,

Using TVM Calculation

PMT = [PV = 8,000, FV = 0, N = 24, I = 0.08/12]

PMT = $361.82

Calculating Loan Balance after 7 months,

Using TVM Calculation,

FV = [PV = 8,000, PMT = -361.82, N = 7, I = 0.08/12]

FV = $5,796.92

Interest paid in 8th payment = 5,796.92(0.08/12) = $38.65

Principal paid in 8th payment = 361.82 - 38.65

Principal paid in 8th payment = $323.17

jeff jeffy answered 2 years ago

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