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Home Q & A Board Other Fields Homework Help Business Accounting
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KarenSmith KarenSmith
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7 years ago
Alex Rod decided to purchase a new crane to be used in his construction business. The crane will cost $125,000 and Alex plans to borrow 75% of the purchase price from the bank at 12% interest.

a.)   How much interest will the bank earn during the first year of the loan?
b.)   At the end of the first year Alex made a $20,000 principal payment. How much interest will the bank earn for the second year of the loan?
c.)   What if Alex made a $40,000 payment at the end of the first year instead of the $20,000 payment, how much interest will he save in the second year?
Textbook 
Survey of Accounting: Making Sense of Business

Survey of Accounting: Making Sense of Business


Edition: 1st
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hol23hol23
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KarenSmith Author
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7 years ago
Many thanks
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