CA Foundation Exam  >  CA Foundation Questions  >  A loan of ₹ 1,02,000 is to be paid back in tw... Start Learning for Free
A loan of ₹ 1,02,000 is to be paid back in two equal annual instalments. If the rate of interest is 4% p.a., compounded annually, then the total interest
charged (in₹) under this instalment plan is.'
?
Most Upvoted Answer
A loan of ₹ 1,02,000 is to be paid back in two equal annual instalment...
Calculation of Total Interest Charged on Loan Repayment


Given, loan amount (P) = ₹ 1,02,000

Rate of interest (r) = 4% p.a.

Number of instalments (n) = 2

Instalment amount = Total repayment amount / Number of instalments = ₹ 1,02,000 / 2 = ₹ 51,000


Calculation of Interest for the First Year


Interest for the first year = P * (1 + r/100)^n - P

= 51,000 * (1 + 4/100)^1 - 51,000

= ₹ 2,040


Calculation of Interest for the Second Year


For the second year, the loan amount outstanding at the beginning of the year is the instalment amount minus the principal repaid in the first year.

Outstanding loan amount at the beginning of the second year = ₹ 51,000 - (51,000 / (1 + 4/100)^1)

= ₹ 49,039.22


Interest for the second year = outstanding loan amount * r/100

= 49,039.22 * 4/100

= ₹ 1,961.57


Total Interest Charged


Total interest charged = Interest for the first year + Interest for the second year

= ₹ 2,040 + ₹ 1,961.57

= ₹ 4,001.57


Therefore, the total interest charged under this instalment plan is ₹ 4,001.57.
Explore Courses for CA Foundation exam
A loan of ₹ 1,02,000 is to be paid back in two equal annual instalments. If the rate of interest is 4% p.a., compounded annually, then the total interestcharged (in₹) under this instalment plan is.'?
Question Description
A loan of ₹ 1,02,000 is to be paid back in two equal annual instalments. If the rate of interest is 4% p.a., compounded annually, then the total interestcharged (in₹) under this instalment plan is.'? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about A loan of ₹ 1,02,000 is to be paid back in two equal annual instalments. If the rate of interest is 4% p.a., compounded annually, then the total interestcharged (in₹) under this instalment plan is.'? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A loan of ₹ 1,02,000 is to be paid back in two equal annual instalments. If the rate of interest is 4% p.a., compounded annually, then the total interestcharged (in₹) under this instalment plan is.'?.
Solutions for A loan of ₹ 1,02,000 is to be paid back in two equal annual instalments. If the rate of interest is 4% p.a., compounded annually, then the total interestcharged (in₹) under this instalment plan is.'? in English & in Hindi are available as part of our courses for CA Foundation. Download more important topics, notes, lectures and mock test series for CA Foundation Exam by signing up for free.
Here you can find the meaning of A loan of ₹ 1,02,000 is to be paid back in two equal annual instalments. If the rate of interest is 4% p.a., compounded annually, then the total interestcharged (in₹) under this instalment plan is.'? defined & explained in the simplest way possible. Besides giving the explanation of A loan of ₹ 1,02,000 is to be paid back in two equal annual instalments. If the rate of interest is 4% p.a., compounded annually, then the total interestcharged (in₹) under this instalment plan is.'?, a detailed solution for A loan of ₹ 1,02,000 is to be paid back in two equal annual instalments. If the rate of interest is 4% p.a., compounded annually, then the total interestcharged (in₹) under this instalment plan is.'? has been provided alongside types of A loan of ₹ 1,02,000 is to be paid back in two equal annual instalments. If the rate of interest is 4% p.a., compounded annually, then the total interestcharged (in₹) under this instalment plan is.'? theory, EduRev gives you an ample number of questions to practice A loan of ₹ 1,02,000 is to be paid back in two equal annual instalments. If the rate of interest is 4% p.a., compounded annually, then the total interestcharged (in₹) under this instalment plan is.'? tests, examples and also practice CA Foundation tests.
Explore Courses for CA Foundation exam

Top Courses for CA Foundation

Explore Courses
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
10M+ students study on EduRev