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Safari File Edit View History Bookmarks Window Help | 700% | Home Layout Tables Charts SmartArt Formulas Data Review Number Font Alignment Edit abeWrap Text General Merge A4 Patrick's Delivery Services is buying a van to help with deliveries. The cost of the vehi A:B: C Long-Term Liabilities Using Excel for long-term notes payable amortization schedula services is bying a van to help with deliveries. The cost of the vehicle es $35,000, the interest rate is 6%, and the loan is for three years. The van is to be repaid in three equal instalment payments, Payments are due at the end of each year 5 )Use the blue shaded areas on the ENTER ANSWERS tab for nputs 7ALWAYS use cell references and formulas where appropriate to receive full credit. Copy/pasting values will NOT earn full points. 0 Requirements 11 Complete the data table. Enter all amounts as positve values. Do nat use a minus sign ar parentheses for any valuos 2 uing the present value of an ardinary annuity table, calculate the payment amount and complete the amortitation schedule. Use the effective interest amortization method. Enter all amounts as positive values. Do not use a minus sign or parentheses for any values. a. Calculate the loan payment by dividing the loan amount by the appropriate present value factor b. Round values to twa decimal places 13 16 Calculate the interest expense in the third vear as the loan payment minus the loan balance at the beginning of the third year c. Use absolute cell references and relative cell references in formulas Use absolute cel references 6 and C19 only to calculate interest expense and payment calculations 3 Using the Excel PMT function, calculate the payment amount and complete the amortization schedule. 20 Use the effective interest amortization method a. The PMT function caicu ates a payment amount that results in a negative number b. Round values to two decimal places e Use absalute cel references and relative cell references in formuas Reverse this to a positive number for caleulatians in the amertization schedule Calculate the interest expense in the third year as the loan payment minus the loan balance at the beginning of the third year Use absolute cell references C6 and (39 only to calcuiate interest expense and payment calculations 24 29 Excel Skils 30 1 Formulas using both abiolute and relative cell references

Explanation / Answer

1) Data Table

2) Total payment at the end of each year = Loan amount/PVAF(6%, 3 yrs)

= $35,000/2.6730 = $13,093.90

Amortization Schedule for loan (Amounts in $)   

DATA Loan amount $35,000 Interest rate 6% Periods 3 years

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