On December 1,2018,Garden Products borrowed $92,000 on a 5%,10-year note with annual installment payments of $9200 plus interest due on December 1 of each subsequent year.Which of the following describes the first installment payment made on December 1,2019? (Round your answer to the nearest whole number.)

Question

Quizplus · Accepted Answer

The first installment payment includes $9200 of principal plus $4600 of interest. The interest is calculated as 5% of the initial loan amount ($92,000), which equals $4600.

On December 1,2018,Garden Products Borrowed $92,000 on a 5%,10-Year Note