Question

Vondior Company borrowed $25,000 cash on January 1st, 2015. The loan is a 5-year note at 8% interest. Vondior Company must repay the loan in 5 equal payments of $6,261.41. How much total interest will Vondior recognize during the 5-year period?

Answer 1

e. $6,307

Step-by-step explanation:

Options are "$25,000, $31,307, $10,000, $21,307, $6,307"

Total amount repaid $31,307.05

($6,261.41 * 5)

Less: Amount borrowed $25,000.00

Total interest $6,307.05