- 11 Marks
FM – NOV 2015 – L2 – Q4a – Introduction to Financial Management
Prepare a loan repayment schedule for Dinpa Supermarket indicating the interest and principal repayment for a term loan.
Question
a. Dinpa Supermarket is considering acquiring a loan of GH₵300,000 from Abrempong Bank Ltd. The loan is payable in five equal annual installments at an interest rate of 25%. Dinpa Ltd has consulted you to determine their annual repayment amount and the interest thereon.
Required:
i. Prepare a repayment schedule for Dinpa indicating clearly the interest payment and the principal repayment. (8 marks)
ii. State THREE (3) advantages of a term loan over an overdraft facility. (3 marks)
Find Related Questions by Tags, levels, etc.
- Tags: Interest Payment, Loan Repayment, Principal Repayment
- Level: Level 2
- Topic: Introduction to Financial Management
- Series: NOV 2015
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