In Excel, create the amortization table for a 15-year mortgage for $950,000 at 4.2% interest. Individual...

In Excel, create the amortization table for a 15-year mortgage for $950,000 at 4.2% interest.

Individual taxpayers may be able to deduct the amount of interest that they paid on a mortgage for a personal residence. If the mortgage was issued on May 1, how much interest will be earned in the first year?

How much interest will be earned in the second year?

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Expert Solution

Individual taxpayers able to deduct the interest that they paid on mortgage. Interest saved in first year is $39000 and in second year is $77832.58

PMT NO	PAYMENT DATE	BEGINNING BALANCE	SCHEDULED PAYMENT	EXTRA PAYMENT	TOTAL PAYMENT	PRINCIPAL	INTEREST	ENDING BALANCE	CUMULATIVE INTEREST
1	6/28/2019	$950,000.00	$86,643.26	$100.00	$86,743.26	$46,843.26	$39,900.00	$903,156.74	$39,900.00
2	7/28/2019	$903,156.74	$86,643.26	$100.00	$86,743.26	$48,810.68	$37,932.58	$854,346.06	$77,832.58
3	8/28/2019	$854,346.06	$86,643.26	$100.00	$86,743.26	$50,860.73	$35,882.53	$803,485.34	$113,715.12
4	9/28/2019	$803,485.34	$86,643.26	$100.00	$86,743.26	$52,996.88	$33,746.38	$750,488.46	$147,461.50
5	10/28/2019	$750,488.46	$86,643.26	$100.00	$86,743.26	$55,222.75	$31,520.52	$695,265.71	$178,982.02
6	11/28/2019	$695,265.71	$86,643.26	$100.00	$86,743.26	$57,542.10	$29,201.16	$637,723.61	$208,183.18
7	12/28/2019	$637,723.61	$86,643.26	$100.00	$86,743.26	$59,958.87	$26,784.39	$577,764.75	$234,967.57
8	1/28/2020	$577,764.75	$86,643.26	$100.00	$86,743.26	$62,477.14	$24,266.12	$515,287.60	$259,233.69
9	2/28/2020	$515,287.60	$86,643.26	$100.00	$86,743.26	$65,101.18	$21,642.08	$450,186.42	$280,875.77
10	3/28/2020	$450,186.42	$86,643.26	$100.00	$86,743.26	$67,835.43	$18,907.83	$382,350.99	$299,783.60
11	4/28/2020	$382,350.99	$86,643.26	$100.00	$86,743.26	$70,684.52	$16,058.74	$311,666.47	$315,842.34
12	5/28/2020	$311,666.47	$86,643.26	$100.00	$86,743.26	$73,653.27	$13,089.99	$238,013.21	$328,932.33
13	6/28/2020	$238,013.21	$86,643.26	$100.00	$86,743.26	$76,746.71	$9,996.55	$161,266.50	$338,928.89
14	7/28/2020	$161,266.50	$86,643.26	$100.00	$86,743.26	$79,970.07	$6,773.19	$81,296.43	$345,702.08
15	8/28/2020	$81,296.43	$86,643.26	$0.00	$81,296.43	$77,881.98	$3,414.45	$0.00	$349,116.53

Rahul Sunny answered 1 year ago

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