Question

Create the amortization schedule for a loan of $12,500, paid monthly over three years using an APR of 9 percent. Enter the data for the first three months. (Round your answers to 2 decimal places.)

beginning balance, total payment, interest paid, Principe paid and ending balance. For all 3 years

Answer 1

	Monthly rate(M)=	yearly rate/12=	0.75%	Monthly payment=	397.50
Month	Beginning balance (A)	Monthly payment	Interest = M*A	Principal paid	Ending balance
1	12500.00	397.50	93.75	303.75	12196.25
2	12196.25	397.50	91.47	306.02	11890.23
3	11890.23	397.50	89.18	308.32	11581.91

Where

Interest paid = Beginning balance * Monthly interest rate

Principal = Monthly payment – interest paid

Ending balance = beginning balance – principal paid

Beginning balance = previous Month ending balance