AIE $10\mathrm{.}1($Algo$)-$ Creating an installment loan schedule.

On January $1,$ Year $1,$ ArkWay United Company borrowed $\backslash (\backslash$$ $102,000\backslash )$ cash from a bank by issuing a $10-$year, $9$ percent note.

The principal and interest are to be paid by making annual payments in the amount of $\backslash (\backslash$$ $15,894\backslash ).$

Payments are to be made December $31$ of each year beginning December $31,$ Year $1.$

Required:

a$.$ Complete the loan summary reference table by using the PMT function to calculate annual interest payment on the loan.

b$.$ Complete the installment loan schedule using the values from your reference table in Requirement A $.$

c$.$ Answer the following questions pertaining to the amounts you calculated in each schedule:

$1.$ Did more of the cash payment in Year $1$ go to pay for interest or the loan principal?

$2.$ Did more of the cash payment in Year $10$ go to pay for interest or the loan principal?

d$.$ Enter various values in the provided loan installment schedule template to assist you in answering the following questions:

$1.$ Holding all other loan terms constant, would increasing the number of periods make the annual cash payments cheaper or more expensive?

$2.$ Holding all other loan terms constant, would increasing the interest rate make the annual cash payments cheaper or more expensive?

Navigation:

$1.$ Use the Open Excel in New Tab button to launch this question.

$2.$ When finished in Excel, use the Save and Return to Assignment button in the lower right to return to Connect.

$2$ Or Janu$$ry $1,$ Year $1,$ ArkWay United Company borrowed $5102,000$ cash from a bank by issuing a $10.$year, $9$ perce int note.

$3$ The pnincipal and interest are to be paid by making annual payments in the amount of $\backslash$$$15,894.$

$4$ Fayments are to be made December $31$ of each year beginning December $31,$ Year$1.$

Required:

Note: Use cells A$2$ to C$8$ from the given Information to complete these questions.

a$.$ Use the FiMT function to calculate annulal asin payment on the loan.

b$.$ Complete the instaliment loan schedule.

$8$ Note: Enter all amounts as positive amounts. c$.$ Answer the following questions pertaining to the amounts you calculated in each schedule:

$1.$ Did more of the cash payment in Year $1$ go to pay for interest or the loan principal?

$2.$ Did more of the cash payment in Year $10$ go to pay for interest or the loan principal? $\backslash ($ r $\backslash )$

d$.$ Enter various values in the provided loan installment schedule template to assist you in answering the following questions: Note: Values entered in Cells B$44$ and B$45$ do not count toward your grade.

$1.$ Holding all other loan terms constant, would increasing the number of periods make the annual cash payments cheaper or more expensive?

$2.$ Holding all other loan terms constant, would increasing the interest rate make the annual cash payments cheaper or more expensive?