The monthly payment on a five-year loan for $30,287 at 6% interest would be $585.53. unanswered Insurance. A time deposit or term deposit (in the United States also known as a certificate of deposit) is a deposit in a financial institution with a specific maturity date or a period to maturity, commonly referred to as its “term”. Whenever a principal payment occurs, the balance of the principal amount owed will decrease. Presuming that you are making interest payments only on a term loan, divide the interest rate stated in the loan documents by the number of payments made in a year. Investing activities d. Ordinary activities 35. Operating activities c. Borrowing activities b. The world of bonds has its own unique terminology, and understanding these terms are necessary to be able to not only properly invest in bonds, but to calculate the interest payment of a bond. Therefore, the next interest payment will be smaller than the previous interest payment. Let us assume there is a $20,000 loan receivable, with an interest rate of 15%, on which payment has … The face value of a bond can be thought of as its principal. 33. Face (or par) value. Show transcribed image text. Additional costs: Loans are often quoted with an annual percentage rate (APR). It represents interest payable on any borrowings – bonds, loans, convertible debt or lines of credit. Generally, the interest payment is related to the principal amount that is owed to the lender. This number tells you how much you pay per year and may include additional costs above and beyond the interest charges. These items together—currency, and checking accounts in banks—make up the definition of money known as M1, which is measured daily by the Federal Reserve System. Answer: E . You would pay $35,131.80 in monthly payments. Example of Accrued Interest . C) unit of account. It … Coins, c. Savings deposits, d. Checkable deposits. Throw in the 10% down payment, and the car costs $38,497. Lending activities d. Financing activities 34. Dividend payments to owners should be classified as cash outflows for a. Example of Loan Payment. Conversely, some cash flows relating to operating activities are classified as investing and financing activities. Operating activities c. Financing activities b. Your pure interest cost is the interest rate (not the APR). time deposits. Time deposits differ from at call deposits, such as savings or checking accounts, which can be withdrawn at any time, without any notice or penalty. C) traveler's checks . Interest expense is a non-operating expense shown on the income statement. Multiply the result times the principal outstanding. Interest payments to lenders and other creditors should be classified as cash outflows for a. Learn the terminology for calculating a bond's interest payments. An interest payment is based upon the annual interest rate and the principal amount outstanding for the period. 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