PLEASE answer the boxes in white. & Show all work to ensure accuracy. Please ans
ID: 2594782 • Letter: P
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PLEASE answer the boxes in white. & Show all work to ensure accuracy. Please answer the question as asked. The answers in GREEN are correct. Thank you
Problem 14-3 Martinez Inc. developed a new sales gimmick to help sell its inventory of new automobiles. Because many new car buyers need financing, Martinez offered a low downpayment and low car payments for the first year after purchase. It believes that this promotion will bring in some new buyers On January 1, 2017, a customer purchased a new $29,000 automobile, making a downpayment of $760. The customer signed a note indicating that the annual rate of interest would be 8% and that quarterly payments would be made over 3 years. For the first year, Martinez required a $353 quarterly payment to be made on April 1 July 1, October 1, and January 1, 2018. After this one-year period, the customer was required to make regular quarterly payments that would pay off the loan as of January 1, 2020 /Your answer is partially correct. Try again Prepare a note amortlzation schedule for the first year. (Round answers to 0 decimal places, e.g. 38,548.) Cash Paid Interest Expense Discount Amortized Carrying Amount of Note Date 28240 35 565 21 35 35 35Explanation / Answer
Date Cash paid Interest Discount Carrying expense amortized amount of at 2% note 1/1/2017 28240 4/1/2017 353 565 212 28452 7/1/2017 353 569 216 28668 10/1/2017 353 573 220 28888 1/1/2018 353 578 225 29113 Amount owed at the end of the first year = $29,113 New quarterly payment = 29113*0.02*1.02^8/(1.02^8-1) = 3974 Date Cash paid Interest Discount Carrying expense amortized amount of at 2% note 1/1/2018 29113 4/1/2018 3974 582 3392 25721 7/1/2018 3974 514 3460 22262 10/1/2018 3974 445 3529 18733 1/1/2019 3974 375 3599 15134 4/1/2019 3974 303 3671 11462 7/1/2019 3974 229 3745 7717 10/1/2019 3974 154 3820 3898 1/1/2020 3976 78 3898 0
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