Eric borrows $17500 to purchase a used truck. He is able to secures a loran for...

Eric borrows $17500 to purchase a used truck. He is able to secures a loran for 7 years at 4.9% interest compounded monthly, which makes his payment's $246.52. After 7 years off making payments how much would eric still owe ? round to the nearest dollar

Solutions

Expert Solution

Answer:

Months	Monthly payment	Interest expense	Reduction in carrying amount	Caryying amount
				$17,500.00
1	$246.52	$71.46	$175.06	$17,324.94
2	$246.52	$70.74	$175.78	$17,149.16
3	$246.52	$70.03	$176.49	$16,972.67
4	$246.52	$69.31	$177.21	$16,795.45
5	$246.52	$68.58	$177.94	$16,617.51
6	$246.52	$67.85	$178.67	$16,438.85
7	$246.52	$67.13	$179.39	$16,259.45
8	$246.52	$66.39	$180.13	$16,079.33
9	$246.52	$65.66	$180.86	$15,898.46
10	$246.52	$64.92	$181.60	$15,716.86
11	$246.52	$64.18	$182.34	$15,534.52
12	$246.52	$63.43	$183.09	$15,351.43
13	$246.52	$62.69	$183.83	$15,167.60
14	$246.52	$61.93	$184.59	$14,983.01
15	$246.52	$61.18	$185.34	$14,797.67
16	$246.52	$60.42	$186.10	$14,611.58
17	$246.52	$59.66	$186.86	$14,424.72
18	$246.52	$58.90	$187.62	$14,237.10
19	$246.52	$58.13	$188.39	$14,048.72
20	$246.52	$57.37	$189.15	$13,859.56
21	$246.52	$56.59	$189.93	$13,669.64
22	$246.52	$55.82	$190.70	$13,478.93
23	$246.52	$55.04	$191.48	$13,287.45
24	$246.52	$54.26	$192.26	$13,095.19
25	$246.52	$53.47	$193.05	$12,902.14
26	$246.52	$52.68	$193.84	$12,708.30
27	$246.52	$51.89	$194.63	$12,513.68
28	$246.52	$51.10	$195.42	$12,318.25
29	$246.52	$50.30	$196.22	$12,122.03
30	$246.52	$49.50	$197.02	$11,925.01
31	$246.52	$48.69	$197.83	$11,727.19
32	$246.52	$47.89	$198.63	$11,528.55
33	$246.52	$47.07	$199.45	$11,329.11
34	$246.52	$46.26	$200.26	$11,128.85
35	$246.52	$45.44	$201.08	$10,927.77
36	$246.52	$44.62	$201.90	$10,725.87
37	$246.52	$43.80	$202.72	$10,523.15
38	$246.52	$42.97	$203.55	$10,319.60
39	$246.52	$42.14	$204.38	$10,115.22
40	$246.52	$41.30	$205.22	$9,910.00
41	$246.52	$40.47	$206.05	$9,703.95
42	$246.52	$39.62	$206.90	$9,497.05
43	$246.52	$38.78	$207.74	$9,289.31
44	$246.52	$37.93	$208.59	$9,080.72
45	$246.52	$37.08	$209.44	$8,871.28
46	$246.52	$36.22	$210.30	$8,660.99
47	$246.52	$35.37	$211.15	$8,449.83
48	$246.52	$34.50	$212.02	$8,237.82
49	$246.52	$33.64	$212.88	$8,024.93
50	$246.52	$32.77	$213.75	$7,811.18
51	$246.52	$31.90	$214.62	$7,596.56
52	$246.52	$31.02	$215.50	$7,381.06
53	$246.52	$30.14	$216.38	$7,164.68
54	$246.52	$29.26	$217.26	$6,947.41
55	$246.52	$28.37	$218.15	$6,729.26
56	$246.52	$27.48	$219.04	$6,510.22
57	$246.52	$26.58	$219.94	$6,290.28
58	$246.52	$25.69	$220.83	$6,069.45
59	$246.52	$24.78	$221.74	$5,847.71
60	$246.52	$23.88	$222.64	$5,625.07
61	$246.52	$22.97	$223.55	$5,401.52
62	$246.52	$22.06	$224.46	$5,177.05
63	$246.52	$21.14	$225.38	$4,951.67
64	$246.52	$20.22	$226.30	$4,725.37
65	$246.52	$19.30	$227.22	$4,498.15
66	$246.52	$18.37	$228.15	$4,270.00
67	$246.52	$17.44	$229.08	$4,040.91
68	$246.52	$16.50	$230.02	$3,810.89
69	$246.52	$15.56	$230.96	$3,579.93
70	$246.52	$14.62	$231.90	$3,348.03
71	$246.52	$13.67	$232.85	$3,115.18
72	$246.52	$12.72	$233.80	$2,881.38
73	$246.52	$11.77	$234.75	$2,646.63
74	$246.52	$10.81	$235.71	$2,410.91
75	$246.52	$9.84	$236.68	$2,174.24
76	$246.52	$8.88	$237.64	$1,936.60
77	$246.52	$7.91	$238.61	$1,697.99
78	$246.52	$6.93	$239.59	$1,458.40
79	$246.52	$5.96	$240.56	$1,217.83
80	$246.52	$4.97	$241.55	$976.29
81	$246.52	$3.99	$242.53	$733.75
82	$246.52	$3.00	$243.52	$490.23
83	$246.52	$2.00	$244.52	$245.71
84	$246.52	$1.00	$245.52	$0.19

Interest expense = preceding carring amount *0.004083333(monthly raeye 4.9%)

Reduction in carrying amount =Payment - Interset expense

Carring Amount = preceding carring amoun- Reduction in carring amount

ekkarill92 answered 1 year ago

Next > < Previous

Related Solutions

Consider the follow events cash of $112 was used to purchase a used truck cash of...

Consider the follow events cash of $112 was used to purchase a used truck cash of $80,000 was used to retire bonds cash of $50,000 was received from the sale of an investment at a loss cash dividends of $28,000 were received from an investment plant assests were depreciated $12,000, under the straight-line method compute the net cash flow from Investing activities The answer is (62,000). Could you please explain how to solve this problem. I get confused between operating,...

Eric’s Excavations has a financial year which ends on the 30th June. Eric purchased a truck...

Eric’s Excavations has a financial year which ends on the 30th June. Eric purchased a truck for $200,000 on 1 July 2019, and estimates that the asset will have a residual value of $50,000 and a useful life of 5 years. The truck was sold on 31 December 2020 for $160,000. Required: Calculate the annual depreciation on the truck for the year ended 30th June 2020 and prepare the adjusting journal entry for depreciation . Show an excerpt from the...

Eric Johnson started the Johnson grocery Company after years of not being able to get fresh...

Eric Johnson started the Johnson grocery Company after years of not being able to get fresh baked goods in Grand Rapids. Johnson Grocery originally specialized in cakes, tarts, breads, and doughnuts sold from Eric’s home. His success with the affluent, gourmet foodies allowed him to expand to a second store within six months and a half-dozen outlets within the first year. He has expanded into bagels, salads, and gourmet foods such as ice cream and pet food. Once Eric...

ABC Company is considering the purchase of a new garbage truck ON 1/1/20. The truck will...

ABC Company is considering the purchase of a new garbage truck ON 1/1/20. The truck will cost $40,000 and have useful life of 5 years with a salvage value of $0. The new truck is much more efficient than the old delivery truck and should increase the company’s annual cash operating income by $12,000. Straight-line depreciation will be used. The income tax rate is 25% and ABC Company’s hurdle rate is 10%. PRESENT VALUE TABLES ON THE EXAM’S LAST PAGE. Payback...

3) Eric has decided he wants to lose weight. He decides to cut all carbs from...

3) Eric has decided he wants to lose weight. He decides to cut all carbs from his diet and eat a diet high in protein and fat. During his workouts, he feels weak and sluggish. Why might this be happening? What would you recommend for him to change, if anything? Use physiology to answer. 4) Tyler is 22 years old and wants to be a bodybuilder. He works hard during the week at his job so he goes out to...

Frank is an avid investor. He borrows money to make investments during the year, he incurred...

Frank is an avid investor. He borrows money to make investments during the year, he incurred $3,500 of interest expense. During the year, he had the following income items $1,000 of qualified dividends, $500 of interest income from a corporate bond, $200 from a municipal bond and $6,000 of net L/T capital gains. How much of investment interest expense can Frank claim on his return?

Prior to 2018, Yusuf’s monthly salary was $1,000 and he used to purchase 40kg of dates....

Prior to 2018, Yusuf’s monthly salary was $1,000 and he used to purchase 40kg of dates. Now, his salary is $5,000 and the quantity of date increased to 75kg. a). Calculate income elasticity of demand for date c) Explain your answer in (a)

Eric Dishman states that healthcare needs to shift from the mainframe to personalized medicine. Is he...

Eric Dishman states that healthcare needs to shift from the mainframe to personalized medicine. Is he correct? Is this happening? What are the barriers? Will technology help? Is it affordable?

Eric left high school to work in a factory where he has been for the last...

Eric left high school to work in a factory where he has been for the last 9 years. He married at 19 and has 2 children. He is unhappy and cynical. He doesn't like working hard to make purchase decisions so he waits until a product is easy to find before he buys. multiple choice -late majority -innovator -early adopter -early majority -laggard Brandon is a successful professional. He is a divorced father of a 10 year old. He is...

Eric wants to start a car detailing business but is unsure how many cars he will...

Eric wants to start a car detailing business but is unsure how many cars he will need to detail before making a profit. His cousin has offered to let him use a small section of his shop for only $300 per month. Eric is going to pay his friend $10/hour to help him. He has estimated his additional expenses and other details to be the following: Insurance $200/month His share of monthly utilities $95 Wax (will yield 10 cars) $19.00...

Subjects