A company borrows $81000 at 12% simple interest from State Bank to purchase equipment. State Bank requires the company to make monthly interest-only payments and pay the full $81000 at the end of 5 years. In order to meet the 5 year obligation of $81000,the company makes equal deposits at the end of each month into a sinking fund with Wolf Savings. The sinking fund earns 6% compounded monthly. Note: This problem is set to allow for an answer of a specific tolerance. Be careful in your rounding. You may get some answers correct but not be in the range of answers for the others.
a. State the monthly interest payment to State Bank (rounded normally to the next cent).
$
b. State the amount of the equal monthly deposits to Wolf Savings, rounded normally to the next cent.
$
c. State the sinking fund balance at the end of 3 years.
$
d. State the total amount of interest earned on the sinking fund at the end of 3 years.
$