After the first payment, Clifton's loan balance is
... $130,000 + 595.83 - 738.13 = $129,857.70
One month's interest on this balance is
... $129,857.70 × 0.055/12 = $595.18
Answer:
$595.18 is the amount of his second payment went toward interest.
Step-by-step explanation:
Given : Clifton took out a 30-year loan for $130,000 at 5.5% interest, compounded monthly. if his monthly payment on the loan is $738.13, and if $595.83 of his first payment went toward interest.
To find : How much of his second payment went toward interest?
Solution :
Loan amount = $130,000
Rate of interest = 5.5%=0.055
Time = 30 year
Monthly payment = $738.13
First payment towards interest = $595.83
After the first payment, Clifton's loan balance is
[tex]\$130000 + \$595.83 - \$738.13 = \$129,857.70[/tex]
One month's interest on this balance is
[tex]\$129857.70 \times \frac{0.055}{12} = \$595.18[/tex]
Therefore, $595.18 is the amount of his second payment went toward interest.
