Question: On August 1, a $30,000, 6%, 3-year installment note payable is issued by a company. The note requires equal payments of principal plus accrued interest

On August 1, a $30,000, 6%, 3-year installment note payable is issued by a company. The note requires equal payments of principal plus accrued interest be paid each year on July 31. The present value of an annuity factor for 3 years at 6% is 2.6730. The payment each July 31 will be:

a $10,000.00.

b $11,223.34.

c $10,800.00.

d $10,400.00.

e $1,223.34.

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