Question

Jim wants to purchase a used boat. The price is $8,000 cash or $1,200 down and 18 monthly payments of $429.00. Jim decided to finance the boat.

Calculate:

The amount he will finance.
The total amount of this monthly payments.
The total finance charge.

Answer 1

The total monthly payments would be (18 payments) * ($429/payment) = $7,722.Adding the down payment of $1,200 gives a total amount of $8,922.
Since the upfront price would have been $8,000, this means that the total finance charge is $8,922 - $8,000 = $922.