HW Q: Loan Balance of Amortization Schedule for Martha's $112,500 house

[Cos I Said So]

Hey All,

New here, was referred by a friend who said you were kind enough to help him with his homework question which worked out well for him. So.. here I am! I'll provide you with my homework question and my answer and the correct answer (per the professor), I'll happily accept I'm wrong so long as I understand how I got the answer wrong.

Instructions: Refer to spreadsheet ch11ex06.xls to answer the question below:
What is Martha’s loan balance after three months?

Round your answer to two decimal places.


​

A. Martha Williams wants to buy a home priced at $112,500. The interest rate is 9%, the down payment is 20%, and the length of the loan is 15 years. Calculate the monthly payment.
Purchase Price		$112,500.00
Interest Rate		9%
Length of Loan in Years		15
Down Payment Percent		20%
Down Payment
Amount Financed
Units
Factor		10.1427
Monthly Payment
Directions:
a. In Cell C8, enter a formula to compute the Down Payment.
b. In Cell C9, enter a formula to compute the Amount Financed.
c. In Cell C10, enter a formula to compute the $1,000 Units of Amount Financed.
d. In Cell C12, enter a formula to compute the Monthly Payment.
e. Format Cells C8, C9, and C12 for Currency, 2 Decimal places, and $. Format Cell C10 for Number. Set Decimal places to 0.
B. Complete the amortization schedule for the first three months of the mortgage.
Month	Monthly Payment	Interest Portion	Principal Portion	Loan Balance
–––––	–––––	–––––	–––––
1
2
3
Directions
a. In Cell E24, enter the Amount Financed from Cell C9.
b. In Cell B25, enter the amount of the Monthly Payment. Copy it in Cells B26 and B27.
c. In Cell C25, enter a formula to compute the Interest Portion of the first Monthly Payment.
d. In Cell D25, enter a formula to compute the Principal Portion.
e. In Cell E25, enter a formula to calculate the Loan Balance after the first month’s payment.
f. Copy the formulas in Cells C25, D25, and E25 to Rows 26 and 27 to complete the spreadsheet.
g. Format Columns B, C, D, and E for Currency, 2 Decimal places, and $.
h. Save the file as ch11ex06a.xlsx.
So, my answers are below - A. Martha Williams wants to buy a home priced at $112,500. The interest rate is 9%, the down payment is 20%, and the length of the loan is 15 years. Calculate the monthly payment. Purchase Price $112,500.00 Interest Rate 9% Length of Loan in Years 15 Down Payment Percent 20% Down Payment $22,500.00 Amount Financed $90,000.00 Units 90 Factor 10.1427 Monthly Payment $912.84 B. Complete the amortization schedule for the first three months of the mortgage. Month Monthly Payment Interest Portion Principal Portion Loan Balance ––––– ––––– ––––– ––––– $90,000.00 1 $912.84 $675.00 $237.84 $89,762.16 2 $912.84 $673.22 $239.63 $89,522.53 3 $912.84 $671.42 $241.42 $89,281.11

The answer I provided for the assignment was $89,281.11, which was marked incorrect. The correct answer as provided by my professor is $89,281.12.

Any help here on how and why I was off by one cent would be greatly appreciated. In total, there were 3 questions similar to this that I got wrong all by one cent. If anyone is curious to the formulas I've used to get my values I'd be happy to post them.

 

[tkhunny]

Tiny rounding issue. Some systems want you to round as you go. That should fix it.

$89,281.11544 doesn't usually cut it.

 

[Denis]

The answer I provided for the assignment was $89,281.11, which was marked incorrect.
The correct answer as provided by my professor is $89,281.12.

Are you serious?!

Your 2nd payment:
$912.84 $673.22 $239.63 $89,522.53
should be:
$912.84 $673.22 $239.62 $89,522.54

 

[Denis]

Tiny rounding issue. Some systems want you to round as you go. That should fix it.
$89,281.11544 doesn't usually cut it.

Yer way off TK; should be: 89,281.1154459380811926411

 

[Cos I Said So]

Yer way off TK; should be: 89,281.1154459380811926411

Thank you both for your help! Looks like my error occurred in the interest portion of the assignment?

Interest Portion

–––––

$675.000000

$673.216178

$671.418976

This is more of an excel question than a math question, but if the cell was formatted as a currency at 2 decimal places what would have caused it to not round correctly?

 

[JeffM]

Thank you both for your help! Looks like my error occurred in the interest portion of the assignment?

Interest Portion

–––––

$675.000000

$673.216178

$671.418976

This is more of an excel question than a math question, but if the cell was formatted as a currency at 2 decimal places what would have caused it to not round correctly?

Were your interest numbers negative numbers?

 

[Denis]

Were your interest numbers negative numbers?

One thing fer sure: they were INTERESTing :cool: