Finding implicit interest rates constructing amortization schedules. Herman Company purchased a plot of land for possible future development. The land had fair value of $86,000. Berman Company gave a 3-year interest-bearing note. The note had face value of $100,000 and provided for interest at a slated rate of 8%. The note requires payments of 58,000 at the end of each of three years, the last payment coinciding with the maturity of the note€™s face value of $100,000.
a. What is the interest rate implicit in the note, accurate to the nearest tenth of 1%?
b. Construct an amortization schedule for the note for each year. Show the carrying value of the note at the start of the year, interest for the year, payment for the year, amount reducing or increasing the carrying value of the note for each payment. and the carrying value of the note at the end of each year. Use the interest rate found in part a. See Exhibit 10.2 for an example of an amortizationschedule.

Amortization Schedule for $800,000 Loan, Repaid in 10 Semiannual Installments of $93,784.41. Interest Rate Is 6% Compounded Semiannually (3% compounded each six months) EXHIBIT 10.2 Portion of Balance at Beginning of Period (2) Interest Balance Expense for Period Payment Reducing Principal at End of Period Cash Payment (4) Period (5) (1) (3) (6) s800,000.00 $24,000.00 $93,784.41 (569,784.41) $730,215.59 (571,877.94) $730,215.59 $21,906.47 $93,784.41 $658,337.65 $658,337.65 $19,750.13 $93,784.41 (574,034.28) $584,303.37 $584,303.37 $17,529.10 593,784.41 (S76,255.31) 4. $508,048.06 (S78,542.97) $508,048.06 $15,241.44 $93,784.41 $429,505.09 $429,505.09 $12,885.15 (580,899.26) 593,784.41 $348,605,83 $348,605.83 (583,326.24) $10,458.17 593,784.41 $265,279.60 S 7,958.39 S 5,383.61 S 2,731.64 (585,826.02) S265,279.60 $93,784.41 $179,453.58 S 91,052.77 (S88,400.80) $179,453.58 $93,784.41 S 91,052.77 (591,052.77) S91,784.41 10 Column (2) - Column (6) from previous period. Column (3) - .03 x Column (2), except for period 10, where it is the amount such that Column (3) - Column (4) - Column (5). Column (4) is given. Column (5) - Column (4) - Column (3). Column (6) - Column (2) - Column (5).