Anita has borrowed $1,000 on which interest is charged at 6% effective.Anita is accumulating a sinking fund
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Anita has borrowed $1,000 on which interest is charged at 6% effective.Anita is accumulating a sinking fund at 4% effective to repay the loan.At the end of 5 years, the balance in the sinking fund is $587.82.At the end of the 6th year, Ada makes a total payment of $168.53.
(a) How much of the $168.53 pays interest currently on the loan?
(b) How much of the $168.53 goes into the sinking fund?
(c) How much of the $168.53 should be considered as net interest?
(d) How much of the $168.53 should be considered as principal?
(e) What is the sinking fund balance at the end of the 6th year?
Related Book For
Advanced Financial Accounting
ISBN: 978-0137030385
6th edition
Authors: Thomas Beechy, Umashanker Trivedi, Kenneth MacAulay
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