Calculate the monthly loan instalments

Assignment Help Finance Basics
Reference no: EM132662033

As a small software developer firm, you have approached the AXZ Bank to obtain a term loan so that the firm can purchase a new server. The AXZ bank provides two (2) offers to your company, as listed below:

a) a loan of $100,000 over a five (5) year period at an interest rate of 7.65% per annum (per year) payable at the end of each month.

b) a loan of $100, 000 over a three (3) year period at an interest rate of 5.5% per annum (per year) payable at the end of each month.

Requirements

1. Calculate the monthly loan instalments for each offer listed above - a) and b).

2. Calculate the total interest payments for each offer listed above - a) and b).

Reference no: EM132662033

Questions Cloud

What is a good example of a pure discount loan : What is a good example of an amortized loan? What is a good example of an interest-only loan? What is a good example of a pure discount loan?
Identify the stages of group development : Identify the stages of group development. Why is it necessary for project teams to move through these stages in order to be productive?
Did the video change your opinion on suicide : Please watch the video and answer the following questions: Did this video change your opinion on suicide? What did the video teach you about suicide?
How is Holly taxed on the distribution : On October 1, Penguin distributes $40,000 in cash to Holly, its sole shareholder. How is Holly taxed on the distribution
Calculate the monthly loan instalments : 1. Calculate the monthly loan instalments for each offer listed above - a) and b). 2. Calculate the total interest payments for each offer listed above
What are the tax consequences to Lime and to Harry : The land is subject to a liability of $120,000, which Harry assumes. What are the tax consequences to Lime and to Harry
Which rate do need to use in time value of money calculation : Which rate should you use to compare alternative investments or loans? Which rate do you need to use in the time value of money calculations?
Explain homemade leverage : Maestro Foods expects to earn $365,000 in perpetuity before interest and taxes from its line of gourmet TV dinners. the company has a debt to assets ratio of 40
What are the tax consequences to Heather : What are the tax consequences to Heather (amount and type of income and basis in property received) and Silver Corporation

Reviews

Write a Review

Finance Basics Questions & Answers

  Buying an existing business

From the e-Activity, discuss the best possible method for determining the value of the business you selected. Explain your rationale.

  Maximum possible gain and loss

An investor bought 200 shares of stock at $50. The stock now sells for $70 and the investor writes a 70 call for $3.50. What is the maximum possible gain and loss in this covered call position?

  What is the yield on given days risk-free securities

Assume that interest rate parity holds. In both the spot market and the 90-day forward market, 1 Japanese yen = 0.0086 dollar.

  Compute the current yield and the promised yield

Compute the current yield and the promised yield (use semiannual compounding) for the bond the Carters currently hold and for each of the three swap candidates.

  Tax brackets for taxable income

1. The Coolidge family had taxable income of $165,000 in 2006. They live in a state in which income over $100,000 is taxed at 11%. What was their total effective (marginal) tax rate? 2. Use the following tax brackets for taxable income:

  What is marketing discipline

What is marketing discipline? What is most people's perception of marketing discipline?

  What is the current value of firm

Assume Lycan's EBITDA for 2022 will be $2,000,000. What is the current value of this firm if it's WACC is 12%?

  What is the value of the stock per share

John is considering purchasing some preferred stock from BBCC Corp. The company pays a $30 annual dividend on its preferred stock, and John believes

  How should monte carlo simulation be used to help determine

how should monte carlo simulation be used to help determine a projects

  Define regression model to explain variation in traffic flow

What other independent variables could you include in your regression model to explain more variation in traffic flow?

  Compute the bond current yield

a. Compute the bond's current yield. (Round your answer to 2 decimal places.) b. Compute the yield to maturity. (Round your answer to 2 decimal places.)

  Calculate the internal rate of return of the investment

Calculate the internal rate of return of this investment, and decide whether it is worthwhile if the current market rate of interest is 11% per annum.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd