Question

Consider a 30 year loan for $129508 at an annual interest rate of 8%. If payments are made yearly, how many dollars of the 16th payment will go toward interest? Round your answer to the nearest dollar.

Answer 1

Answer—Amount of interest on 16^th Installment will be $ 7,977

Loan amount	$ 1,29,508.00
PV Factor	11.257783
Annual instalment amount	$      11,503.86

Loan Statement
Year	Loan amount balance	Interest	Installment	Ending balance
1	$ 1,29,508.00	$        10,360.64	$ (11,503.86)	$       1,28,364.78
2	$ 1,28,364.78	$        10,269.18	$ (11,503.86)	$       1,27,130.10
3	$ 1,27,130.10	$        10,170.41	$ (11,503.86)	$       1,25,796.64
4	$ 1,25,796.64	$        10,063.73	$ (11,503.86)	$       1,24,356.51
5	$ 1,24,356.51	$           9,948.52	$ (11,503.86)	$       1,22,801.17
6	$ 1,22,801.17	$           9,824.09	$ (11,503.86)	$       1,21,121.40
7	$ 1,21,121.40	$           9,689.71	$ (11,503.86)	$       1,19,307.24
8	$ 1,19,307.24	$           9,544.58	$ (11,503.86)	$       1,17,347.96
9	$ 1,17,347.96	$           9,387.84	$ (11,503.86)	$       1,15,231.93
10	$ 1,15,231.93	$           9,218.55	$ (11,503.86)	$       1,12,946.63
11	$ 1,12,946.63	$           9,035.73	$ (11,503.86)	$       1,10,478.49
12	$ 1,10,478.49	$           8,838.28	$ (11,503.86)	$       1,07,812.91
13	$ 1,07,812.91	$           8,625.03	$ (11,503.86)	$       1,04,934.08
14	$ 1,04,934.08	$           8,394.73	$ (11,503.86)	$       1,01,824.94
15	$ 1,01,824.94	$           8,146.00	$ (11,503.86)	$           98,467.07
16	$      98,467.07	$           7,877.37	$ (11,503.86)	$           94,840.57
17	$      94,840.57	$           7,587.25	$ (11,503.86)	$           90,923.96
18	$      90,923.96	$           7,273.92	$ (11,503.86)	$           86,694.01
19	$      86,694.01	$           6,935.52	$ (11,503.86)	$           82,125.67
20	$      82,125.67	$           6,570.05	$ (11,503.86)	$           77,191.86
21	$      77,191.86	$           6,175.35	$ (11,503.86)	$           71,863.34
22	$      71,863.34	$           5,749.07	$ (11,503.86)	$           66,108.55
23	$      66,108.55	$           5,288.68	$ (11,503.86)	$           59,893.37
24	$      59,893.37	$           4,791.47	$ (11,503.86)	$           53,180.98
25	$      53,180.98	$           4,254.48	$ (11,503.86)	$           45,931.59
26	$      45,931.59	$           3,674.53	$ (11,503.86)	$           38,102.25
27	$      38,102.25	$           3,048.18	$ (11,503.86)	$           29,646.57
28	$      29,646.57	$           2,371.73	$ (11,503.86)	$           20,514.43
29	$      20,514.43	$           1,641.15	$ (11,503.86)	$           10,651.73
30	$      10,651.73	$              852.14	$ (11,503.86)	$                          -