Andres Michael bought a new boat. He took out a loan for $23,880 at 4.25% interest for 2 years. He made a $4,000 partial payment at 2 months and another partial payment of $3,000 at 8 months. How much is due at maturity? (Do not round intermediate calculations. Round your answers to the nearest cent.)
answer is 18465.46
To find out how much is due at maturity, we need to calculate the remaining balance on the loan after making the partial payments.
Step 1: Calculate the interest accrued for the loan.
First, we need to calculate the interest accrued for the loan. The interest is calculated using the formula:
Interest = Principal * Rate * Time
In this case, the principal (loan amount) is $23,880, the interest rate is 4.25%, and the time is 2 years.
Interest = $23,880 * 0.0425 * 2
Step 2: Calculate the interest accrued up to the point of the first partial payment.
To calculate the interest accrued up to the point of the first partial payment, we need to determine the number of months that have passed. In this case, 2 months have passed.
Interest1 = Principal * Rate * (Time/12)
= $23,880 * 0.0425 * (2/12)
Step 3: Calculate the interest accrued up to the point of the second partial payment.
To calculate the interest accrued up to the point of the second partial payment, we need to determine the number of months that have passed. In this case, 8 months have passed.
Interest2 = Principal * Rate * (Time/12)
= $23,880 * 0.0425 * (8/12)
Step 4: Calculate the remaining balance on the loan after making the partial payments.
To calculate the remaining balance, we subtract the sum of the partial payments and the accrued interest from the original loan amount.
Remaining Balance = Principal + Interest - Partial Payment1 - Partial Payment2
Remaining Balance = $23,880 + Interest - $4,000 - $3,000
Step 5: Calculate the due amount at maturity.
The due amount at maturity is equal to the remaining balance on the loan.
Due Amount at Maturity = Remaining Balance
Now, let's calculate the values:
Interest = $23,880 * 0.0425 * 2 = $2,025.60
Interest1 = $23,880 * 0.0425 * (2/12) = $169.25
Interest2 = $23,880 * 0.0425 * (8/12) = $676.99
Remaining Balance = $23,880 + $2,025.60 - $4,000 - $3,000 = $19,906.60
Due Amount at Maturity = $19,906.60
Therefore, the amount due at maturity is $19,906.60.
its 18465.45 (Do not round intermediate calculations. Round your answer to the nearest cent.)
Apparently you didn't read (or follow) the directions on the Post a New Question page.
Homework Posting Tips
Please show your work. Tutors will not do your homework for you. Please show your work for any question that you are posting.
...