Any help would be appreciated. Lacking experience on this.
Secured Loan to company $150m
Loan date 2/2/2015=6
Debt expense to be amortized $1,255,891.91
4.53 interest rate with a loan period of 144 months
interest payments due on 7/28 & 1/28 of each year (first interest payment 7/28/2016)
principle payment commencing 1/28/2018 $10m payment annually (loan will not be paid off at end of loan)
Per loan doc year is comprised of 12 months 30 days each
I am calculating the interest by multiplying the outstanding debt balance by 4.53%/12 with payments as indicated above.
I am also amortizing the debt expense using the effective interest rate method
Does the attached make sense or am I missing components, My boss thinks PV or NPV or FV calculations should be included but I don't see why.
Secured Loan to company $150m
Loan date 2/2/2015=6
Debt expense to be amortized $1,255,891.91
4.53 interest rate with a loan period of 144 months
interest payments due on 7/28 & 1/28 of each year (first interest payment 7/28/2016)
principle payment commencing 1/28/2018 $10m payment annually (loan will not be paid off at end of loan)
Per loan doc year is comprised of 12 months 30 days each
I am calculating the interest by multiplying the outstanding debt balance by 4.53%/12 with payments as indicated above.
I am also amortizing the debt expense using the effective interest rate method
Does the attached make sense or am I missing components, My boss thinks PV or NPV or FV calculations should be included but I don't see why.