Question

Find the amortization table for a $23,000 loan amortized over 3 years with semiannual payments if the interest rate is 6.1% per year compounded semiannually. (Round your answers to the nearest cent.) End of Period Payment Made Payment Toward Interest Payment Toward Principal Outstanding Principle 0 23000 1 2 3 4 5 6

Answer #1

Semi Annual rate(M)= | yearly rate/2= | 3.05% | Semi Annual payment= | 4252.78 | |

Half year | Beginning balance (A) | Semi Annual payment | Interest = M*A | Principal paid | Ending balance |

1 | 23000.00 | 4252.78 | 701.50 | 3551.28 | 19448.72 |

2 | 19448.72 | 4252.78 | 593.19 | 3659.60 | 15789.12 |

3 | 15789.12 | 4252.78 | 481.57 | 3771.21 | 12017.91 |

4 | 12017.91 | 4252.78 | 366.55 | 3886.23 | 8131.68 |

5 | 8131.68 | 4252.78 | 248.02 | 4004.77 | 4126.91 |

6 | 4126.91 | 4252.78 | 125.87 | 4126.91 | 0.00 |

Where |

Interest paid = Beginning balance * Semi Annual interest rate |

Principal = Semi Annual payment – interest paid |

Ending balance = beginning balance – principal paid |

Beginning balance = previous Half year ending balance |

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