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You are considering purchasing a car with a sticker price of $36,270 (non negotiable with no down payment required). You wish to make monthly payments for six years and the most that you would like to pay is $600 a month. Your local bank/credit union has agreed to loan you the money at a 4.29% annual interest rate. Create an amortization table reporting the beginning/ending loan balance, total payment, the portion of payment going to interest and principal, and remaining loan balance. Create a IF statement that answers the question of whether you can afford the loan. What is your monthly loan payment and what is the total interest paid on the loan

User Jimrandomh
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1 Answer

4 votes

Answer:

1. Amortization Table:

Amortization Schedule

Beginning Balance Interest Principal Ending Balance

1 $36,270.00 $129.67 $442.59 $35,827.41

2 $35,827.41 $128.08 $444.17 $35,383.24

3 $35,383.24 $126.50 $445.76 $34,937.48

4 $34,937.48 $124.90 $447.35 $34,490.12

5 $34,490.12 $123.30 $448.95 $34,041.17

6 $34,041.17 $121.70 $450.56 $33,590.61

7 $33,590.61 $120.09 $452.17 $33,138.44

8 $33,138.44 $118.47 $453.79 $32,684.65

9 $32,684.65 $116.85 $455.41 $32,229.25

10 $32,229.25 $115.22 $457.04 $31,772.21

11 $31,772.21 $113.59 $458.67 $31,313.54

12 $31,313.54 $111.95 $460.31 $30,853.23

Year #1 End

13 $30,853.23 $110.30 $461.96 $30,391.27

14 $30,391.27 $108.65 $463.61 $29,927.67

15 $29,927.67 $106.99 $465.26 $29,462.40

16 $29,462.40 $105.33 $466.93 $28,995.47

17 $28,995.47 $103.66 $468.60 $28,526.88

18 $28,526.88 $101.98 $470.27 $28,056.60

19 $28,056.60 $100.30 $471.95 $27,584.65

20 $27,584.65 $98.62 $473.64 $27,111.01

21 $27,111.01 $96.92 $475.33 $26,635.68

22 $26,635.68 $95.22 $477.03 $26,158.64

23 $26,158.64 $93.52 $478.74 $25,679.90

24 $25,679.90 $91.81 $480.45 $25,199.45

Year #2 End

25 $25,199.45 $90.09 $482.17 $24,717.29

26 $24,717.29 $88.36 $483.89 $24,233.40

27 $24,233.40 $86.63 $485.62 $23,747.77

28 $23,747.77 $84.90 $487.36 $23,260.42

29 $23,260.42 $83.16 $489.10 $22,771.32

30 $22,771.32 $81.41 $490.85 $22,280.47

31 $22,280.47 $79.65 $492.60 $21,787.86

32 $21,787.86 $77.89 $494.36 $21,293.50

33 $21,293.50 $76.12 $496.13 $20,797.37

34 $20,797.37 $74.35 $497.91 $20,299.46

35 $20,299.46 $72.57 $499.69 $19,799.78

36 $19,799.78 $70.78 $501.47 $19,298.31

Year #3 End

37 $19,298.31 $68.99 $503.26 $18,795.04

38 $18,795.04 $67.19 $505.06 $18,289.98

39 $18,289.98 $65.39 $506.87 $17,783.11

40 $17,783.11 $63.57 $508.68 $17,274.43

41 $17,274.43 $61.76 $510.50 $16,763.93

42 $16,763.93 $59.93 $512.32 $16,251.60

43 $16,251.60 $58.10 $514.16 $15,737.45

44 $15,737.45 $56.26 $515.99 $15,221.45

45 $15,221.45 $54.42 $517.84 $14,703.61

46 $14,703.61 $52.57 $519.69 $14,183.92

47 $14,183.92 $50.71 $521.55 $13,662.37

48 $13,662.37 $48.84 $523.41 $13,138.96

Year #4 End

49 $13,138.96 $46.97 $525.28 $12,613.68

50 $12,613.68 $45.09 $527.16 $12,086.52

51 $12,086.52 $43.21 $529.05 $11,557.47

52 $11,557.47 $41.32 $530.94 $11,026.53

53 $11,026.53 $39.42 $532.84 $10,493.70

54 $10,493.70 $37.51 $534.74 $9,958.95

55 $9,958.95 $35.60 $536.65 $9,422.30

56 $9,422.30 $33.68 $538.57 $8,883.73

57 $8,883.73 $31.76 $540.50 $8,343.23

58 $8,343.23 $29.83 $542.43 $7,800.81

59 $7,800.81 $27.89 $544.37 $7,256.44

60 $7,256.44 $25.94 $546.31 $6,710.12

Year #5 End

61 $6,710.12 $23.99 $548.27 $6,161.86

62 $6,161.86 $22.03 $550.23 $5,611.63

63 $5,611.63 $20.06 $552.19 $5,059.43

64 $5,059.43 $18.09 $554.17 $4,505.27

65 $4,505.27 $16.11 $556.15 $3,949.12

66 $3,949.12 $14.12 $558.14 $3,390.98

67 $3,390.98 $12.12 $560.13 $2,830.85

68 $2,830.85 $10.12 $562.14 $2,268.71

69 $2,268.71 $8.11 $564.15 $1,704.57

70 $1,704.57 $6.09 $566.16 $1,138.40

71 $1,138.40 $4.07 $568.19 $570.22

72 $570.22 $2.04 $570.22 $0.00

Year #6 End

2. IF monthly payment is <$600, then take the loan.

3. The monthly payment is $572.26

4. The total interest paid on the loan is $4,932.42.

Step-by-step explanation:

a) Data and Calculations:

Car loan = $36,270

Expected payment per month = $600

Loan interest rate = 4.29%

Period of payments = 6 years or 72 months

Results:

Payment Every Month $572.26

Total of 72 Payments $41,202.42

Total Interest $4,932.42

User Venkat Prasanna
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