Final answer:
To calculate the interest portion of the next mortgage payment, use the formula Interest = Principal × rate × time, with a principal of $87,557 and a monthly interest rate derived from the annual rate of 3%. The correct answer is $218.89.
Step-by-step explanation:
To determine how much of the next mortgage payment will go towards interest, we use the formula Interest = Principal × rate × time. For a monthly payment calculation, the rate must be the monthly interest rate and the time must be the time period for one month.
In this case, the remaining principal on the mortgage is $87,557 after 10 years. The annual interest rate is 3%, which gives us a monthly interest rate of 0.03 / 12 = 0.0025. The interest for the next payment can be calculated as $87,557 × 0.0025 = $218.8925, which when rounded to the nearest cent is $218.89. Therefore, option A is the correct answer.