Mini Challenge
Food2Go is acquiring new delivery vans! Ishan plans to apply for som
commercial vehicle loans to service the cost of these delivery vans. A
contacting several banks for their loan offerings, he received informa
five products. However, all of their loan descriptions were incomplet
some lacking payment periods and some even missing interest rates
Let's use Financial Functions to help Ishan out.
There are five worksheets containing information on the five differen
products (Loans A-E).
Read the loan descriptions for each loan carefully, then key in the res
information about the loan in the table below. The cells in green req
you to apply financial functions to obtain the required information
Express all your results in positive numbers!
Compare your answers for each of the loans in the respective Solutio
worksheets.
ns to apply for some
se delivery vans. After
e received information on
ns were incomplete, with
sing interest rates!
on the five different
then key in the respective
cells in green require
uired information.
respective Solution
Commercial Vehicle Loan A
To: Ishan (Food2Go)
Subject: Enquiry about your company's auto loan
Good day Sir,
We are pleased to offer an auto loan to your company
totalling $80,000. The loan will be repaid over five
years, with an annual interest rate of 3%.
Kindly inform us if you wish to take up the loan. Thank
you.
XYZ Bank
Variable Value
Principal
Interest rate
Loan term (years)
Payment/month (total)
Payment for first month (principal)
Payment for first month (interest)
Commercial Vehicle Loan A
To: Ishan (Food2Go)
Subject: Enquiry about your company's auto loan
Good day Sir,
We are pleased to offer an auto loan to your company
totalling $80,000. The loan will be repaid over five
years, with an annual interest rate of 3%.
Kindly inform us if you wish to take up the loan. Thank
you.
XYZ Bank
Variable Value
Principal $80,000
Interest rate 3.00%
Loan term (years) 5
Payment/month (total) $1,437.50
Payment for first month (principal) $1,237.50
Payment for first month (interest) $200.00
Commercial Vehicle Loan B
To: Ishan (Food2Go)
Subject: About your car loan
Dear Sir,
Thank you for writing in about your interest pertaining
to our car loan products.
We will be able to arrange for 6-year car loan for a
sum of $75,000. You would be expected to pay $1,100
per month throughout the payment period.
Thank you very much for your consideration.
HighLow Credit
Variable Value
Principal
Payment/month (total)
Loan term (years)
Interest rate
Commercial Vehicle Loan B
To: Ishan (Food2Go)
Subject: About your car loan
Dear Sir,
Thank you for writing in about your interest pertaining
to our car loan products.
We will be able to arrange for 6-year car loan for a
sum of $75,000. You would be expected to pay $1,100
per month throughout the payment period.
Thank you very much for your consideration.
HighLow Credit
Variable Value
Principal $75,000
Payment/month (total) $1,100.00
Loan term (years) 6
Interest rate 1.81%
Commercial Vehicle Loan C
To: Ishan (Food2Go)
Subject: Loan details
Mr Ishan,
Thank you for the conversation we had earlier.
Our company will be most willing to extend a 4.5 year
loan to you, at an attractive interest rate of 2% per
year. You will be expected to pay around $1,050 per
month to cover both the principal and interest.
Do let us know if you would like to follow up with this
loan.
Simple Finance
Variable Value
Interest rate
Payment/month (total)
Loan term (years)
Principal
Commercial Vehicle Loan C
To: Ishan (Food2Go)
Subject: Loan details
Mr Ishan,
Thank you for the conversation we had earlier.
Our company will be most willing to extend a 4.5 year
loan to you, at an attractive interest rate of 2% per
year. You will be expected to pay around $1,050 per
month to cover both the principal and interest.
Do let us know if you would like to follow up with this
loan.
Simple Finance
Variable Value
Interest rate 2.00%
Payment/month (total) $1,050.00
Loan term (years) 4.5
Principal $54,180
Commercial Vehicle Loan D
To: Ishan (Food2Go)
Subject: Food2Go - Commercial Vehicle Loan
Dear Mr Ishan (Food2Go),
Thank you for providing more information about your
company's requirements.
We are pleased to extend a loan amounting to
$85,000 to your company at an interest rate of 2.5%.
With fixed regular payments, you can expect to pay
$1,200 per month to service the debt.
Hoping to hear from you!
Fast Capital
Variable Value
Interest rate
Payment/month (total)
Principal
Loan term (years)
Commercial Vehicle Loan D
To: Ishan (Food2Go)
Subject: Food2Go - Commercial Vehicle Loan
Dear Mr Ishan (Food2Go),
Thank you for providing more information about your
company's requirements.
We are pleased to extend a loan amounting to
$85,000 to your company at an interest rate of 2.5%.
With fixed regular payments, you can expect to pay
$1,200 per month to service the debt.
Hoping to hear from you!
Fast Capital
Variable Value
Interest rate 2.50%
Payment/month (total) $1,200.00
Principal $85,000
Loan term (years) 6.39
Commercial Vehicle Loan E
To: Ishan (Food2Go)
Subject: Your loan scenario
Good afternoon, Mr Ishan (Food2Go),
Thank you for explaining your company's loan
circumstance to us.
We understand you are able to provide maximum
monthly payments of $1100. We are able to provide a
loan of $60000 for an initial period of four years, at an
interest rate of 1.5%. Subsequently, after the four
years term, we can discuss about the refinancing of
the remaining principal and accumulted interest.
Please feel free to contact us for any enquiries.
Flexi Credit
Variable Value
Interest rate
Payment/month (total)
Principal
Initial loan term (years)
Amount remaining after initial financing
Commercial Vehicle Loan E
To: Ishan (Food2Go)
Subject: Your loan scenario
Good afternoon, Mr Ishan (Food2Go),
Thank you for explaining your company's loan
circumstance to us.
We understand you are able to provide maximum
monthly payments of $1100. We are able to provide a
loan of $60000 for an initial period of four years, at an
interest rate of 1.5%. Subsequently, after the four
years term, we can discuss about the refinancing of
the remaining principal and accumulted interest.
Please feel free to contact us for any enquiries.
Flexi Credit
Variable Value
Interest rate 1.50%
Payment/month (total) $1,100.00
Principal $60,000
Initial loan term (years) 4.00
Amount remaining after initial financing $9,327
