Each payment on a periodic payment note payable includes:
A)interest only
B)principal only
C)interest and discount
D)interest and principal

Question

Quizplus · Accepted Answer

Each payment on a periodic payment note payable includes both interest and principal. The payment is typically structured so that the borrower pays interest on the outstanding balance of the loan, and then the remaining amount of the payment goes towards reducing the principal balance. Over time, as the principal balance decreases, the amount of interest included in each payment will also decrease, and more of the payment will go towards paying down the principal.

Each Payment on a Periodic Payment Note Payable Includes