Ask Question
23 August, 09:31

A company purchased equipment and signed a 5-year installment loan at 10% annual interest. The annual payments equal $11,600. The present value of an annuity factor for 5 years at 10% is 3.7908. The present value of a single sum factor for 5 years at 10% is. 6209. The present value of the loan is:

+5
Answers (1)
  1. 23 August, 11:13
    0
    The present value of the loan is $43,973.98

    Explanation:

    In order to calculate the present value of the loan we would have to make the following calculation:

    Present value of the loan=annual payments*present value of an annuity factor for 5 years at 10%

    annual payments=$11,600

    present value of an annuity factor for 5 years at 10%=3.7908

    Therefore, Present value of the loan=$11,600*3.7908

    Present value of the loan=$43,973.98

    The present value of the loan is $43,973.98
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “A company purchased equipment and signed a 5-year installment loan at 10% annual interest. The annual payments equal $11,600. The present ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers