Titleist Ltd borrows $200,000 from the Callaway Bank on the 31st October 20X2. Instalments of $27,893...
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Titleist Ltd borrows $200,000 from the Callaway Bank on the 31st October 20X2. Instalments of $27,893 are made every six months to repay the loan over four (4) years and interest calculated at 5% per annum compounded half yearly. The repayment schedule for the loan is provided below. Titleist Ltd financial year ends on 30th June. Instalment Date Opening Loan Balance $ 200,000 Instalment Paid $ Interest Component $ 27,893 27,893 27,893 27,893 27,893 27,893 27,893 27,897 Principal Reduction $ 5,000 4,428 3,841 3,240 2,623 1,992 1,344 680 30/4/X3 31/10/X3 177,107 30/4/X4 153,642 31/10/X4 129,590 30/4/X5 104,937 31/10/X5 79,667 30/4/X6 53,766 31/10/X6 27,217 * = last instalment amount reflects prior roundings. Required 5 marks Determine the amount/s that would appear in the Balance Sheet of Titleist Ltd in respect of the loan as at the 30th June 20X5 and describe how they would be classified. Show your workings. Closing Loan 22,893 23,465 24,052 24,653 25,270 25,901 26,549 27,217 Balance $ 177,107 153,642 129,590 104,937 79,667 53,766 27,217 0 Titleist Ltd borrows $200,000 from the Callaway Bank on the 31st October 20X2. Instalments of $27,893 are made every six months to repay the loan over four (4) years and interest calculated at 5% per annum compounded half yearly. The repayment schedule for the loan is provided below. Titleist Ltd financial year ends on 30th June. Instalment Date Opening Loan Balance $ 200,000 Instalment Paid $ Interest Component $ 27,893 27,893 27,893 27,893 27,893 27,893 27,893 27,897 Principal Reduction $ 5,000 4,428 3,841 3,240 2,623 1,992 1,344 680 30/4/X3 31/10/X3 177,107 30/4/X4 153,642 31/10/X4 129,590 30/4/X5 104,937 31/10/X5 79,667 30/4/X6 53,766 31/10/X6 27,217 * = last instalment amount reflects prior roundings. Required 5 marks Determine the amount/s that would appear in the Balance Sheet of Titleist Ltd in respect of the loan as at the 30th June 20X5 and describe how they would be classified. Show your workings. Closing Loan 22,893 23,465 24,052 24,653 25,270 25,901 26,549 27,217 Balance $ 177,107 153,642 129,590 104,937 79,667 53,766 27,217 0
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Related Book For
Business Math
ISBN: 978-0133011203
10th edition
Authors: Cheryl Cleaves, Margie Hobbs, Jeffrey Noble
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