Aidan's Inc. is looking to replace its old delivery truck, which constantly breaks down. It just happens that one of its suppliers has a slightly used delivery truck for sale. Because Aidan's Inc. has been doing business with this supplier for many years, the supplier offers Aidan's a great deal. The supplier will sell the truck to Aidan's for $78,000 on January 1, 2020, and issue a 5-year installment note payable at 3% interest. Installment payments of $8,458 are made semi-annually.

Prepare a table to calculate the total interest paid over the life of the note. Note: Due to rounding, make the reduction of the principal in the last payment equal to the remaining principal balance. This will ensure the ending principal balance is $0.

 

Date Jun 30, 2020 Cash Payment Interest Expense Reduction of Principal Principal Balance Jan 1, 2021 Jun 30, 2021 Jan 1, 2022 Jun 30, 2022 Jan 1, 2023 Jun 30, 2023 Jan 1, 2024 Jun 30, 2024 Dec 31, 2024