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Develop an amortization schedule for a 5-year loan of $25,000 at an interest rate of 7.5%,...

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Finance

Develop an amortization schedule for a 5-year loan of $25,000 atan interest rate of 7.5%, assuming equal annual installments at theend of each year. Use the same format that we used in class.

Please show work in Excel

Answer & Explanation Solved by verified expert
4.1 Ratings (574 Votes)

Computation of equal payment
$6,179.12 =PMT(7.5%,5,-25000,0,0)
Amortization table as below
i ii iii=ii*7.5% iv v=ii+iii-iv
Year Beginning loan amount Interest Annual installment Ending loan amount
0 25000
1                                   25,000.00 1,875.00                  6,179.12                    20,695.88
2                                   20,695.88 1,552.19                  6,179.12                    16,068.96
3                                   16,068.96 1,205.17                  6,179.12                    11,095.01
4                                   11,095.01      832.13                  6,179.12                      5,748.02
5                                     5,748.02      431.10                  6,179.12                                  -  

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Develop an amortization schedule for a 5-year loan of $25,000 atan interest rate of 7.5%, assuming equal annual installments at theend of each year. Use the same format that we used in class.Please show work in Excel

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