Loan Amortization Table
Year |
Amount Owed |
Annual Equal Payments |
Interest at 6% |
Principal Repayment |
Ending Balance |
1 |
$30,000.00 |
$11,223.29 |
$1,800.00 |
$9,423.29 |
$20,576.71 |
2 |
$20,576.71 |
$11,223.29 |
$1,234.60 |
$9,988.69 |
$10,588.01 |
3 |
$10,588.01 |
$11,223.29 |
$635.28 |
$10,588.01 |
$0 |
Annual Equal Payment
Interest Rate (r) = 6% per year
Number of Periods = 3 Years
Annual Equal Payment = [P x {r (1+r)^{n}} ] / ( 1+r)^{n} – 1
= [$30,000 x {0.06 x (1 + 0.06)^{3}}] / (1 + 0.06)^{6} - 1
= [$30,000 x {0.06 x 1.191016}] / [1.191016 – 1]
= [$30,000 x 0.071461] / 0.1910160
= $11,223.29 per year
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