Can someone please assist me
The problem reads "use the rule of 78 to find the payoff amount for the loan paid in full before the date"
Finance charge: $717
Total number of payments 41
Amount per payment $155
Remaining payments when paid in full 10
Please help. Thanks in advance
To find the payoff amount using the rule of 78, you'll need to follow these steps:
Step 1: Calculate the sum of the digits from 1 to the total number of payments.
In this case, the total number of payments is 41. So, the sum of the digits from 1 to 41 is calculated using the formula:
Sum = n * (n + 1) / 2
= 41 * (41 + 1) / 2
= 861
Step 2: Calculate the unearned finance charge by multiplying the remaining payments by the amount per payment.
In this case, the remaining payments when paid in full is 10 and the amount per payment is $155. So, the unearned finance charge is:
Unearned Finance Charge = Remaining Payments * Amount per Payment
= 10 * $155
= $1,550
Step 3: Calculate the payoff amount by adding the unearned finance charge to the total finance charge.
In this case, the total finance charge is given as $717. So, the payoff amount is:
Payoff Amount = Unearned Finance Charge + Total Finance Charge
= $1,550 + $717
= $2,267
Therefore, the payoff amount for the loan paid in full before the date, using the rule of 78, is $2,267.