Problem #2: Installment Note Preferred Corporation purchases an asset and finances it with a note payable. Information regarding the transaction follows: $ $ Cost of asset Amount Financed Annual Interest Rate Installment loan term Payments are made 48,000 48,000 12% 2 years 12 times per year USE PROBLEM #2 TO ANSWER QUESTIONS 8 THRU 10 BELOW 8.) Calculate the monthly payment on the note payable. 9.) What is the total amount of interest that will be paid on the note payable over the two year period? 10.) If the company pays an extra $100 per month on the loan how much interest will they save over the life of the loan?
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