Relay-Version: version B 2.10 5/3/83; site utzoo.UUCP Posting-Version: version B 2.10.1 exptools 1/6/84; site ihuxj.UUCP Path: utzoo!watmath!clyde!floyd!harpo!ihnp4!ihuxj!rjh From: rjh@ihuxj.UUCP (Randolph J. Herber) Newsgroups: net.consumers,net.misc Subject: Re: What is "rule of 78's"? Message-ID: <438@ihuxj.UUCP> Date: Thu, 22-Mar-84 17:27:29 EST Article-I.D.: ihuxj.438 Posted: Thu Mar 22 17:27:29 1984 Date-Received: Fri, 23-Mar-84 21:06:55 EST Organization: AT&T Bell Labs, Naperville, IL Lines: 28 A numerical example maybe will clear up the confusion about the "rule of 78's." AMOUNT OF LOAN: $1,000.00 APR: 23.99998 MONTHS TO PAY: 12 PAYMENT AMOUNT: $94.56 = P LAST PAYMENT AMOUNT $94.54 FIRST PAYMENT: 1/1984 RULES OF 78'S AMOUNT $1.726923 = R = $134.70 / 78 AFTER AFTER PAYING PAYING PAYMENT AMOUNT DATE INTEREST REPAY OWED PAY OUT AMOUNT BY 78'S 12/1983 $0.00 $1000.00 $1134.70-78*R=$1000.00 1/1984 $20.00 $74.56 $925.44 $1040.14-66*R= $926.16 2/1984 $18.51 $76.05 $849.39 $945.58-55*R= $850.60 3/1984 $16.99 $77.57 $771.82 $851.02-45*R= $773.31 4/1984 $15.44 $79.12 $692.70 $756.46-36*R= $694.29 5/1984 $13.85 $80.71 $611.99 $661.90-28*R= $613.55 6/1984 $12.24 $82.32 $529.67 $567.34-21*R= $531.07 7/1984 $10.59 $83.97 $445.70 $472.78-15*R= $446.88 8/1984 $8.91 $85.65 $360.05 $378.22-10*R= $360.95 9/1984 $7.20 $87.36 $272.69 $283.66- 6*R= $273.30 10/1984 $5.45 $89.11 $183.58 $189.10- 3*R= $183.92 11/1984 $3.67 $90.89 $92.69 $94.51- 1*R= $92.78 12/1984 $1.85 $92.69 $0.00 $0.00- 0*R= $0.00 TOTAL 1984 $134.70 $1,000.00