Recording and Assessing the Effects of Installment Loans: Semiannual Installments On December 31, 2018, Wasley Corporation borrowed $500,000 on a 10%, 10-year mortgage note payable. The note is to be repaid with equal semiannual installments, beginning June 30, 2019.

Required:
Compute the amount of the semiannual installment payment using a financial calculator or Excel, and round amount to the nearest dollar.

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Parrain Parrain · Answer 1 · 2021-05-06T03:59:55+02:00

Answer: $40,121.29

Explanation:

Using Excel, you are finding the payment which is denoted PMT

The rate is:

= 10%/ 2

= 5% per semi annual period

The Nper or number of periods is:

= 10 * 2

= 20 semi annual periods

Present value of PV is $500,000

Future value is 0 because that is the balance after the payments are done.

Formula will look like:

=PMT(5%,20,-500000,0,0)

Payment will be:

= $40,121.29

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