In: Accounting
Loan Repayment Schedule for 5 years:
Annual Repayment = Total amount of loan / Present Value Annuity factor for the amortisation period @ 5.3%
= 234000 / Present Value Annuity Factor for 15 years @ 5.3%
= 234000 / 10.1723
= 23,003.65.
So, total amount of repayment in the form of instalments = 23,003.65 * 5
= 115,018.25
Amount of prinicipal remained at the end of 5th year which is to be repayed a then = 175,067.10
Total amount of principal and interest paid over the life of the loan = 115018.25 + 175067.10
= 290,085.35
The answer is nearer to C. 289,998.48
The difference can be because of the rounding off of decimals.
Hence, the answer is C. 289,998.48.