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14 January, 17:29

Ralph Phillips obtained a 12-month, $1500.00 loan at 12%. His monthly payment is $133.20. For the first payment find:

a. The interest

b. The payment to principal.

c. The new balance

Answers (1)
  1. K
    14 January, 20:26
    0
    a. The interest is US$ 8.20

    b. The payment to principal is US$ 125.

    c. The new balance is: US$ 1,465.20 (including principal and interest) or US$ 1,375 (just the principal).

    Step-by-step explanation:

    1. Let's review the information given to answer this question correctly:

    Loan obtained by Ralph Phillips = US$ 1,500

    Time of paying back the loan = 12 months

    Interest rate of the loan = 12%

    Monthly payment = US$ 133.20

    2. Let's find a, b and c.

    The principal is US$ 1,500. Dividing it by 12 months, the monthly payment of principal is US$ 125. Therefore,

    a. The interest is (133.20 - 125) = US$ 8.20

    b. The payment to principal is US$ 125.

    c. The new balance is: US$ 1,465.20 (including principal and interest) or US$ 1,375 (just the principal).
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