Refer to the amortization schedule below for a five-year loan of $67,500. The interest rate is 7% per annum and the loan calls for a principal reduction of $13,500 annually.

	Year	Beginning Balance	Total Payment	Interest Payment	Principal Payment	Ending Balance
	1	$67,500.00			$13,500.00
	2				13,500.00
	3		16,335.00	2,835.00	13,500.00	27,000.00
	4	27,000.00	15,390.00	1,890.00	13,500.00	13,500.00
	5	13,500.00	14,445.00	945.00	13,500.00	0.00