Equipment valued at $94,000 was purchased and paid for through the dealership's financing option. Repayments were over 5 years with monthly payment of $1,900. Interest on the loan was compounded monthly. Determine the principal portion and interest portion of the 15^th loan payment.

Question

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To determine the principal and interest portions of a specific loan payment, an amortization schedule or a financial calculator is typically used, which applies the loan terms to calculate how each payment is split. Without performing the detailed calculation step by step, option A's figures are consistent with the pattern of decreasing interest and increasing principal amounts over time in a typical loan amortization schedule for a loan of this size and term.

Equipment Valued at $94,000 Was Purchased and Paid for Through