A $35,000 bank loan is to be repaid in equal yearly payment over 15 years at an effective annual interest rate of 5%. You did the calculation and found that your annual payment is $3372. What is the unpaid principal after you made your 8th payment? A. B. C. D. $17,115 $19,512 $14,599 $21,794

A $35,000 bank loan is to be repaid in equal yearly payment over 15 years at an effective annual interest rate of 5%. You did the calculation and found that your annual payment is $3372. What is the unpaid principal after you made your 8th payment? A. B. C. D. $17,115 $19,512 $14,599 $21,794

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter12: Current Liabilities

Section: Chapter Questions

Problem 4MC: A ski company takes out a $400,000 loan from a bank. The bank requires eight equal repayments of the...

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Concept explainers

Cost of Credit

The cost of credit is an extra amount that the borrower has to pay besides the loan amount. These credit charges may vary from loan to loan. The cost of credit includes interest charges, maintenance charges, and arrangement charges. Some of the costs are mandatorily collected by the lender based on the loan amount and tenure of the loan. The cost of credit is also called finance charges of the credit.

Question

A $35,000 bank loan is to be repaid in
equal yearly payment over 15 years at
an effective annual interest rate of 5%.
You did the calculation and found that
your annual payment is $3372. What is
the unpaid principal after you made
your 8th payment?
A.
B.
C.
D.
$17,115
$19,512
$14,599
$21,794

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