Project #23145 - accounting

tillman bragg has just received a 15-year mortage loan for his newly acquired sundowner Inn. the purchase was financed with an $8,000,000 loan with a stated quarterly interest rate of 2%. payments are due every 3 months. assume a marginal tax rate of 30%. the loan can ve refinanced at the end of year five for 10 years as follows:

7% annual rate

annual payments

closing costs of new financing equal 3% of new loan. assume the closing costs are part of the new loan.

prepayment penalty of 0.5% of the balance due. this would also be part of the new loan

1. prepare loan repayment shcedule for the first 5 years.

2. what is the total interest expense for this loan over 5 years.

3. what is the interest expense less the associated tax for year one.

4. whar is the balance owed at the end of 5 years

5. what would be the amount of the new mortgage rate if the property were refinanced at the end of 5 years

Subject Business
Due By (Pacific Time) 02/18/2014 08:20 pm
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