Page 14 - SOLUTIONS TO PRACTICAL APPLICATION FNSACC313 V3 .doc
P. 14
Perform Financial Calculations
Year Annual
Interest
1 $1365.00
2 $1365.00
3 $1365.00
TOTAL $4095.00
$125000 borrowed at 7% compound interest annually over 7 years.
Year Opening Annual
Balance Interest
1 $125000.00 $8750.00
2 $110555.85 $7738.91
3 $95,100.60 $6,657.04
4 $78,563.49 $5,499.44
5 $60,868.79 $4,260.82
6 $41,935.45 $2,935.48
7 $21,676.78 $1,517.37
PRACTICAL APPLICATION 2
$1500000 invested at 14% compound interest annually over 15 years.
Year Opening Balance Annual Interest
1 $1,500,000.00 $210,000.00
2 $239,400.00
3 $1,949,400.00 $272,916.00
$1,710,000.00 SOLUTIONS
4 $2,222,316.00 $311,124.24
5 $2,533,440.24 $354,681.63
6 $2,888,121.87 $404,337.06
7 $3,292,458.94 $460,944.25
8 $3,753,403.19 $525,476.45
9 $4,278,879.63 $599,043.15
10 $4,877,922.78 $682,909.19
11 $5,560,831.97 $778,516.48
12 $6,339,348.45 $887,508.78
13 $7,226,857.23 $1,011,760.01
14 $8,238,617.24 $1,153,406.41
15 $9,392,023.66 $1,314,883.31
$11500 invested at 4% simple interest over 5 years.
Year Annual Interest
1 $ 460.00
2 $ 460.00
3 $ 460.00
4 $ 460.00
5 $ 460.00
TOTAL $2300.00
Anne Bowden ©2020
14
