ezto.mheducation.com/hm.tpx ACCOUNTING pter 21 Homework Question 5 (of 15) value

Question

ezto.mheducation.com/hm.tpx ACCOUNTING pter 21 Homework Question 5 (of 15) value 1.66 points On January 1, 2016, the Merit Group issued to its bank a $39 million, five-year installment note to be paid in five equal payments at the end of each year. Installment payments of $9.258 million annually include interest at the rate of 6.0%. What would be the amount(s) related to the note that Merit would report in its statement of cash flows for the year ended December 31, 2016? (List each cash flow separately. List any cash outflows with a minus sign. Enter your answers in millions rounded to 2 decimal places (i.e., 5,500,000 should be entered as 5.50).) ($ in millions) Cash outflow from financing activities

Explanation / Answer

AmortiZation Schedule Principal Interest Repayment Outstanding 1      39.000         2.340      (9.258)      32.082 2      32.082         1.925      (9.258)      24.749 3      24.749         1.485      (9.258)      16.976 4      16.976         1.019      (9.258)         8.736 5         8.736         0.521      (9.258)      (0.000) So the loan amount outstanding at the end of 2016              32.082 Cash flow statement Cash flow from Financing activity Interest paid 2.34 Principal Paid           6.92

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