Ana Luisa Bridges is interested in buying office furniture for her business. At Styline Furniture, she picks out furniture for a total retail price of $2,899.00. The salesperson informs her that if she pays 10% down now, she could finance the balance at 12% (compounded monthly). Ana would have to pay it back in 24 monthly installments.

Assume that Ana makes the 10% down payment on March 31, 2020, and decides to finance the remaining balance.

1. Calculate the amount of Ana’s monthly payment. The first payment is scheduled for April 30, 2020. Use the PMT function. (Remember to subtract the down payment from the retail price to find the amount of the loan.)

2. Prepare an amortization schedule in Excel or Google Sheets for the entire 24-month loan.

3. What is the amount of the finance charge on the loan (i.e., how much total interest will Ana pay on the entire loan)? Use a formula to calculate the total interest.

4. Prepare the journal entries required of Ana for each of the following dates:
   1. March 31, 2020 (to record the office furniture, down payment, and loan)
   2. April 30, 2020 (to record the first payment)

Answer rating: 100% (QA)

Answers Given Retail price of furniture 2899 Less down payment at 10 28990 Amount financed 260910 PV ... View the full answer