FM Question 1: Answer: The cash flow basis recognises only the actual inflow and outflow of cash items;

items sales on credit terms are not considered to be an inflow of cash until the actual collection of cash is received or due. The income statement uses accrual basis that accrues amounts receivable or payable in accordance to their allocated periods.
B et Cas udg hflowS tatem ent Feb Balance Brought Forward Personal Savings Cost of Racking& Equipm ent Purchase of a Ford Van Insurance for Ford Van Maintenance for Ford Van Monthly Causal Labour S alary Monthly Clerk S alary Monthly Rental Monthly Admin Cost Monthly Salary for Mr Lang Purchases of Watches Sales of Watches Balance Carried Forward B et Incom S udg e tatem ent Feb Mar Apr May Jun Insurance for Ford Van $ (22.22) $ (22.22) $ (22.22) $ (22.22) $ (22.22) Maintenance for Ford Van $ (100.00) $ (100.00) $ (100.00) $ (100.00) $ (100.00) Monthly Causal Labour S alary $ (3,000.00) $ (3,000.00) $ (3,000.00) $ (3,600.00) Monthly Clerk S alary $ (1,200.00) $ (1,200.00) $ (1,200.00) $ (1,200.00) Monthly Rental $ (800.00) $ (800.00) $ (800.00) $ (800.00) Monthly Admin Cost $ (600.00) $ (600.00) $ (600.00) $ (600.00) Monthly Salary for Mr Lang $ (1,000.00) $ (1,000.00) $ (1,000.00) $ (1,000.00) Purchases of Watches $ (4,500.00) $ (6,000.00) $ (7,500.00) $(10,500.00) Sales of Watches $ 18,000.00 $ 24,000.00 $ 30,000.00 Profit /(Loss) $ (122.22) $(11,222.22) $ 5,277.78 $ 9,777.78 $ 12,177.78 Jul $ (22.22) $ (100.00) $ (3,600.00) $ (1,200.00) $ (800.00) $ (600.00) $ (1,000.00) $ (9,000.00) $ 42,000.00 $ 25,677.78 Aug $ (22.22) $ (100.00) $ (3,600.00) $ (1,200.00) $ (800.00) $ (600.00) $ (1,000.00) $ (4,500.00) $ 36,000.00 $ 24,177.78 Sept Oct $ (22.22) $ (22.22) $ (100.00) $ (100.00) $ (3,000.00) $ (3,000.00) $ (1,200.00) $ (1,200.00) $ (800.00) $ (800.00) $ (600.00) $ (600.00) $ (1,000.00) $ (1,000.00) $ 18,000.00 $ 11,277.78 $ (6,722.22) $ $ 4,000.00 $ (900.00) $ (2,000.00) $ (200.00) $ (100.00) $ $ $ $ $ $ $ $ Mar Apr May Jun Jul 800.00 $(10,400.00) $(23,100.00) $(19,300.00) $(13,100.00) $ Aug Sept Oct 600.00 $ 30,800.00 $ 60,100.00

$ (100.00) $ (3,000.00) $ (1,200.00) $ (800.00) $ (600.00) $ (1,000.00) $ (7,500.00) $ 18,000.00 800.00 $(10,400.00) $(23,100.00) $(19,300.00)

(100.00) (3,000.00) (1,200.00) (800.00) (600.00) (1,000.00) (4,500.00)

$ $ $ $ $ $ $

(100.00) (3,000.00) (1,200.00) (800.00) (600.00) (1,000.00) (6,000.00)

$ (100.00) $ (3,600.00) $ (1,200.00) $ (800.00) $ (600.00) $ (1,000.00) $(10,500.00) $ 24,000.00 $(13,100.00)

$ (100.00) $ (3,600.00) $ (1,200.00) $ (800.00) $ (600.00) $ (1,000.00) $ (9,000.00) $ 30,000.00 $ 600.00

$ (100.00) $ (3,600.00) $ (1,200.00) $ (800.00) $ (600.00) $ (1,000.00) $ (4,500.00) $ 42,000.00 $ 30,800.00

$ (100.00) $ (100.00) $ (3,000.00) $ (3,000.00) $ (1,200.00) $ (1,200.00) $ (800.00) $ (800.00) $ (600.00) $ (600.00) $ (1,000.00) $ (1,000.00) $ 36,000.00 $ 18,000.00 $ 60,100.00 $ 71,400.00

Mr Lang would have cash flow issues in the monthly of Mar to Jun due to the monthly expenses and prior months of purchases of watch to be sold accordingly to his scheduled months of sales. To further slow down his cash inflow cycle, all the sales made were on 1 month credit terms. Mr Lang has to acquire at least additional cash flow of S$65,900 to cover for the negative cash flow in months of Mar to Jun in order to continue his operations.

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Answer 2

A class of ownership in a corporation that has a higher claim on the assets and earnings than common stock. Preferred stock generally has a dividend that must be paid out before dividends to common stockholders and the shares usually do not have voting rights. The precise details as to the structure of preferred stock are specific to each corporation. However, the best way to think of preferred stock is as a financial instrument that has characteristics of both debt (fixed dividends) and equity (potential appreciation). Also known as "preferred shares".

Preferred stock holders are different in two key aspects :

First, preferred stock holders have a greater claim to a companys asset and earnings. This is true during the good times when the company has excess cash and decide to distribute money in the form of dividend to its investors. In these instances when distributors are made, preferred stock holders must be paid before common stock holders. However, this claim is most important during times of insolvency when common stock holders are last in line for the companys assets. This mean that when the company liquidate and pay all creditors and bond holders , common stock holders will not receive any money until after the preferred share holders are paid out.

Second, the dividend of preferred stock is different from and generally greater than those of common stock. When you buy a preferred stock, you will have an idea of when to expect a dividend because they are paid at regular intervals. This is not necessarily the case for common stock, as the company board of directors will decide whether or not pay out a dividend. Because of this characteristics, preferred stock do not fluctuate as often as companys common stock and can some time be classified as a fixed income security. Adding to this fixed income personality is the fact that the dividend are typically guaranteed , meaning that if the company
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does miss one , it will be required to pay it before any future dividends are paid on either stock.

Common Shares

Securities representing equity ownership in a corporation, providing voting rights, and entitling the holder to a share of the company's success through dividends and/or capital appreciation. In the event of liquidation, common shareholders have rights to a company's assets only after bondholders, other debt holders, and preferred shareholders have been satisfied. Typically, common shareholders receive one vote per share to elect the company's board of directors (although the number of votes is not always directly proportional to the number of shares owned). The board of directors is the group of individuals that represents the owners of the corporation and oversees major decisions for the company.

Common shareholders also receive voting rights regarding other company matters such as stock splits and company objectives. In addition to voting rights, common shareholders sometimes enjoy what are called "pre-emptive rights". Pre-emptive rights allow common shareholders>to maintain their proportional ownership in the company in the event that the company issues another offering of stock. This means that common shareholders with preemptive rights have the right but not the obligation to purchase as many new shares of the stock as it would take to maintain their proportional ownership in the company. Also called junior equity or common stock

Discount Bond A bond that is issued for less than its par (or face) value, or a bond currently trading for less than its par value in the secondary market. The "discount" in a discount bond doesn't necessarily mean that investors get a better yield than the market is offering, just a price below par. Depending on the length of time until maturity, zero-coupon bonds can be issued at very discount bond offers investors additional appreciation if the security is held until maturity.
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large discounts to par, sometimes 50% or more. In addition to semi-annual interest payments, a

Because a bond will always pay its full face value at maturity (assuming no credit events occur), discount bonds issued below par - such as zero-coupon bonds - will steadily rise in price as the maturity date approaches. These bonds will only make one payment to the holder (par value at maturity) as opposed to periodic interest payments. A distressed bond (one that has a high likelihood of default) can also trade for huge discounts to par, effectively raising its yield to very attractive levels. The consensus, however, is that these bonds will not receive full or timely interest payments at all; because of this, investors who buy into these issues become very speculative, possibly even making a play for the company's assets or equity.

Bonds selling more than their face value

When the terms premium and discount are used reference to bonds, they are telling investors that the purchase price of bond either above or below the par value. For example, if a bond with a par value of $ 1,000 is selling at a premium when it can be bought for more than $1000 and is selling at a discount when it can be bought for less than $ 1,000. Bonds can be sold for more than and less than par values because changing interest rates. Like most fixed income securities, bonds are highly correlated to interest rates. When interest rates go up, a bonds market price fall and vice versa.

To better explain this, lets look at an example, imagine that the market interest rates is 30 % today and you just purchased a bond paying a 5% coupon with a face value of $ 1,000. If interest rates go down by 10% from the time of your purchase, you will able to sell the bond for a profit (or premium). This is because the bond is now paying more than the market rate (because the coupon rate is 5%). The spread used to be 2 %( 5%- 3%), but it now increased to 3 %( 5% - 2%). This is a simplified way of looking at a bonds price, as many other factors
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involved; however, it does show the general relationship between bonds and interest rates.

U S Treasury Bill

A negotiable debt obligation issued by the U.S. government and backed by its full faith and credit, having a maturity of one year or less. U.S. Treasury Bills are exempt from state and local taxes. These securities do not pay a coupon rate of interest, and the interest earned is estimated by taking the difference between the price paid and the par value of the bond, and calculating that rate of return on an annual basis. Treasury Bills are considered the safest securities available to the U.S. investor, and so the yield on these securities are considered the risk-free rate of return. Also called Bill or T-Bill or Treasury bill.

United States treasury securities also known as treasures are fixed income security instruments issued by U S treasury. These securities make up the largest and most important and most liquid fixed income market place in the world. Treasuries appeal to a wide range of US investors, including bank, insurance companies, pension plans and individuals. Because so much of the commerce is denominated in united states dollars. Treasuries also have broad appeal among non US citizen and entities as well.

Disadvantage of US Treasury Bill

Treasury bonds offer a relatively low yield to maturity when compared to other investments. The low yield to maturity refers to a bonds rate of return (expressed as an annual rate.) if its held until maturity. Because of their many other advantages, investors are generally, willing to accept a lower yield from Treasures than other bonds. Treasury bonds are exposed to political risk. These bonds do not have traditional credit risk because the federal government can print as much as money as is necessary in order to avoid defaulting on its debts. However, the government constantly issue new debt in order to pay off its maturing debt and the US senate must authorise the issuing of new debt. In the event of a political dispute, its possible that the senate could refuse such authorisation there by causing a technical default.
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Answer 3

Current ratio = current asset current liabilities Current ratio (2008) = 158,000 110,000 = 1.47 Current ratio (2007) = 224,000 122,000= 1.84

A liquidity ratio that measures a company's ability to pay short-term obligations. An indication of a company's ability to meet short-term debt obligations; the higher the ratio, the more liquid the company is. Current ratio is equal to current assets divided by current liabilities. If the current assets of a company are more than twice the current liabilities, then that company is generally considered to have good short-term financial strength. If current liabilities exceed current assets, then the company may have problems meeting its short-term obligations. For example, if XYZ Company's total current assets are $10,000,000, and its total current liabilities are $8,000,000, then its current ratio would be $10,000,000 divided by $8,000,000, which is equal to 1.25. XYZ Company would be in relatively good short-term financial standing.

Quick ratio = current asset inventories current liabilities Quick ratio (2008) = 158,000 - 3000 110,000 = 1.41 Quick ratio (2007) = 224,000 - 4000 122,000 = 1.80

An indicator of a company's short-term liquidity. The quick ratio measures a company's ability to meet its short-term obligations with its most liquid assets. The higher the quick ratio, the better the position of the company. Quick ratio, often referred to as acid-test ratio, is obtained by subtracting inventories from current assets and then dividing by current liabilities. means stronger, lower number means weaker).
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Quick ratio is viewed as a sign of company's financial strength or weakness (higher number

For example, if current assets equal $15,000,000, current inventory equals $6,000,000, and current liabilities equal $3,000,000, then quick ratio amounts to: ($15,000,000 - $6,000,000)/ $3,000,000 = 3. Since we subtracted current inventory, it means that for every dollar of current liabilities there are three dollars of easily convertible assets. In general, a quick ratio of 1 or more is accepted by most creditors; however, quick ratios vary greatly from industry to industry.

Asset turn over = revenue asset Asset turn over (2008) = 641,000 1458,000 = 0.44 Asset turn over (2007) = 749,000 1,934,000= 0.39

The amount of sales generated for every dollar's worth of assets. It is calculated by dividing sales in dollars by assets in dollars. Asset turnover measures a firm's efficiency at using its assets in generating sales or revenue - the higher the number the better. It also indicates pricing strategy: companies with low profit margins tend to have high asset turnover, while those with high profit margins have low asset turnover.

Fixed asset turn over = net sales net property, plant, equipment Fixed asset turn over (2008) = 641,000 1,300,000-27,000= 0.50 Fixed asset turn over (2007) = 749,0001,710,000- 27,000 = 0.45 The fixed-asset turnover ratio measures a company's ability to generate net sales from fixedasset investments - specifically property, plant and equipment (PP&E) - net of depreciation. A higher fixed-asset turnover ratio shows that the company has been more effective in using the investment in fixed assets to generate revenues. This ratio is often used as a measure in manufacturing industries, where major purchases are made for PP&E to help increase output. years to see how effective the investment in the fixed assets was.
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When companies make these large purchases, prudent investors watch this ratio in following

Debt to asset ratio = total debt total asset Debt to asset ratio (2008) = 800,000 1,458,000 = 0.55 Debt to asset ratio (2007) = 632,000 1,934,000 = 0.33

A ratio that indicates what proportion of debt a company has relative to its assets. The measure gives an idea to the leverage of the company along with the potential risks the company faces in terms of its debt-load. A debt ratio of greater than 1 indicates that a company has more debt than assets; meanwhile, a debt ratio of less than 1 indicates that a company has more assets than debt. Used in conjunction with other measures of financial health, the debt ratio can help investors determine a company's level of risk.

Debt to equity ratio = total liabilities share holders equity Debt to equity ratio (2008) = 800,000 658,000 = 1.22 Debt to equity ratio (2007) 632,0001,202,000 0.53

A measure of a company's financial leverage calculated by dividing its total liabilities by stockholders' equity. It indicates what proportion of equity and debt the company is using to finance its assets. A high debt/equity ratio generally means that a company has been aggressive in financing its growth with debt. This can result in volatile earnings as a result of the additional interest expense. If a lot of debt is used to finance increased operations (high debt to equity), the company could potentially generate more earnings than it would have without this outside financing. If this were to increase earnings by a greater amount than the debt cost (interest), then the shareholders. However, the cost of this debt financing may outweigh the return that the
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shareholders benefit as more earnings are being spread among the same amount of

company generates on the debt through investment and business activities and become too much for the company to handle. This can lead to bankruptcy, which would leave shareholders with nothing. The debt/equity ratio also depends on the industry in which the company operates. For example, capital-intensive industries such as auto manufacturing tend to have a debt/equity ratio above 2, while personal computer companies have a debt/equity of under 0.5.

Times interest earned = earnings before interest and tax financial cost Times interest earned (2008) = 231,000 20,000 = 11.55 Times interest earned (2007) = 315,000 30,000 = 10.50

A metric used to measure a company's ability to meet its debt obligations. It is calculated by taking a company's earnings before interest and taxes (EBIT) and dividing it by the total interest payable on bonds and other contractual debt. It is usually quoted as a ratio and indicates how many times a company can cover its interest charges on a pre-tax basis. Failing to meet these obligations could force a company into bankruptcy. Ensuring interest payments to debt holders and preventing bankruptcy depends mainly on a company's ability to sustain earnings. However, a high ratio can indicate that a company has an undesirable lack of debt or is paying down too much debt with earnings that could be used for other projects. The rationale is that a company would yield greater returns by investing its earnings into other projects and borrowing at a lower cost of capital than what it is currently paying to meet its debt obligations

Net profit margin = net income revenues Net profit margin (2008) = 151,000 641,000 = 0.24 Net profit margin (2007) = 225,000 749,000 = 0.30
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A ratio of profitability calculated as net income divided by revenues, or net profits divided by sales. It measures how much out of every dollar of sales a company actually keeps in earnings. Profit margin is very useful when comparing companies in similar industries. A higher profit margin indicates a more profitable company that has better control over its costs compared to its competitors. Profit margin is displayed as a percentage; a 20\% profit margin, for example, means the company has a net income of $0.20 for each dollar of sales.

Looking at the earnings of a company often doesn't tell the entire story. Increased earnings are good, but an increase does not mean that the profit margin of a company is improving. For instance, if a company has costs that have increased at a greater rate than sales, it leads to a lower profit margin. This is an indication that costs need to be under better control. Imagine a company has a net income of $10 million from sales of $100 million, giving it a profit margin of 10% ($10 million/$100 million). If in the next year net income rises to $15 million on sales of $200 million, the company's profit margin would fall to 7.5%. So while the company increased its net income, it has done so with diminishing profit margins.

Return on investment (asset) = net income total asset Return on investment (2008) = 151,000 1,458,000 = 0.10 Return on investment 92007) = 225,000 1,934,000 = 0.12

An indicator of how profitable a company is relative to its total assets. ROA gives an idea as to how efficient management is at using its assets to generate earnings. Calculated by dividing a company's annual earnings by its total assets, ROA is displayed as a percentage. Sometimes this is referred to as "return on investment".

companies can vary substantially and will be highly dependent on the industry. This is why

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ROA tells you what earnings were generated from invested capital (assets). ROA for public

when using ROA as a comparative measure, it is best to compare it against a company's previous ROA numbers or the ROA of a similar company. The assets of the company are comprised of both debt and equity. Both of these types of financing are used to fund the operations of the company. The ROA figure gives investors an idea of how effectively the company is converting the money it has to invest into net income. The higher the ROA number, the better, because the company is earning more money on less investment. For example, if one company has a net income of $1 million and total assets of $5 million, its ROA is 20%; however, if another company earns the same amount but has total assets of $10 million, it has an ROA of 10%. Based on this example, the first company is better at converting its investment into profit. When you really think about it, management's most important job is to make wise choices in allocating its resources. Anybody can make a profit by throwing a ton of money at a problem, but very few managers excel at making large profits with little investment.

Return on equity = net income share holders equity Return on equity (2008) = 151,000 658,000 = 0.23 Return on equity (2007) = 225,000 1,202,000 = 0.19

The amount of net income returned as a percentage of shareholders equity. Return on equity measures a corporation's profitability by revealing how much profit a company generates with the money shareholders have invested

Net income is for the full fiscal year (before dividends paid to common stock holders but after dividends to preferred stock.) Shareholder's equity does not include preferred shares
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There are several variations on the formula that investors may use:

1. Investors wishing to see the return on common equity may modify the formula above by subtracting preferred dividends from net income and subtracting preferred equity from shareholders' equity, giving the following: return on common equity (ROCE) = net income preferred dividends / common equity. 2. Return on equity may also be calculated by dividing net income by average shareholders' equity. Average shareholders' equity is calculated by adding the shareholders' equity at the beginning of a period to the shareholders' equity at period's end and dividing the result by two. 3. Investors may also calculate the change in ROE for a period by first using the shareholders' equity figure from the beginning of a period as a denominator to determine the Beginning ROE. Then, the end-of-period shareholders' equity can be used as the denominator to determine the ending ROE. Calculating both beginning and ending ROEs allows an investor to determine the change in profitability over the period.

Occupancy percentage = room sold number of rooms available Occupancy percentage 92008) = (13,050,000 / 365) 59 = 61% Occupancy percentage (2007) = (9,950 / 365) 59 = 46%

Average daily rate = room revenue number of rooms sold Average daily rate (2008) = 641,000 13,050 = 49.12 Average daily rate (2007) = 749,000 9,950 = 75.28

REVPAR = average daily room rate occupancy rate

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A performance metric in the hotel industry, which is calculated by multiplying a hotel's average daily room rate (ADR) by its occupancy rate. It may also be calculated by dividing a hotel's total guestroom revenue by the room count and the number of days in the period being measured. Revpar (2008) = 49.12 * 0.61 =29.77 Revpar (2009) = 75.28 *0.46 =34.78

Answer 4 Analysis of 2008 vs 2007: Fiscal ratio Current ratio Quick ratio Asset turn over Fixed asset turn over Debt to asset ratio Debt to equity ratio Times interest earned Net profit margin Return on investment (Asset) Return on equity Occupancy percentage Average daily rate REVPAR 1.44 1.41 0.44 0.50 0.55 1.22 11.55 0.24 0.10 0.23 0.61 49.12 29.77 2008 1.84 1.80 0.39 0.45 0.33 0.53 10.50 0.30 0.12 0.19 0.46 75.28 34.78 2007

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1.Lower current ratio of 1.44 in 2008 reflects a heavier liability cost to pay and a poorer ability to pay them; as compared to 2007 of 1.84 2.Lower quick ratio of 1.41 in 2008 reflects a lesser liquidity to pay back its current liabilities as compared to 2007 of 1.80 3.Higher Asset turnover in 2008 of 0.44 reflects a better efficiency of generating more revenue with its assets than 2007 of 0.39. 4.Higher fixed assets turnover in 2008 of 0.5 reflect a better efficiency of generating more revenue with its fixed assets than 2007 of 0.45. 5.Higher Debt to assets ratio in 2008 of 0.55 reflects that the company is more dependent on the on its liabilities to fund its assets and has a higher level of financial risk as compared to 2007 of 0.33 6.A higher debt/equity ratio in 2008 of 1.22 generally means it has been aggressive in financing its growth with debt. This can result in volatile earnings as a result of the additional interest expense as compared to 2007 of 0.53 7.Higher Times interest earned in 2008 of 11.55 indicate that it has an undesirable lack of debt or is paying down too much debt with earnings that could be used for other projects. 8.A Lower Net profit margin of 0.24 in 2008 reflects a lesser earning power as compared to 2007 of 0.30 9.A lower ROI of 0.10 in 2008 reflects a lower generation of revenue earned on its assets and is not favourable as compared to 2007 of 0.12 10.Higher ROE of 0.23 in 2008 reflects that more income is generated for its equity and its consider better than 2007 of 0.19.

Answer 5 Value on common stock = Dividend stock price + growth rate

= $12 $27 + 8% = 15.41%

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Answer 6

Value of coupon bond = PVIFA (n = 6years, I = 4%) interest +PVIF (n = 6years, I = 4%) maturity = 5.2421 ($1,000 7%) + 0.7903 $1,000 = $1,157.25

Answer 7 ( I )

Amortize the loan Your annual interest rate converted to a decimal 6% 100.0 = 0.060. You will have 1 4 = 4 total payments to make. The interest rate at each payment is 0.06% 1.00 = 0.0600 You can calculate the amount of each payment using this formula Payment = I amount 1- (1+1) N = 0.06$45,000 1- ( 1+ 0.06) 4 = $2,7000 0.207906 = $12,986.62 Where I = 0.060(the interest rate at the time of the payment), and N = 4 the number of periods). From this formula, you will pay $12986.62, 1 times a year. After knowing that we would need to pay $12,986.62 a year for 4 times , we can put the payment amount , interest amount and principal amount in a schedule for reference
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Year 1: $45,000- ($12,986.62( first payment ) - $2,700(interest) = $45,000 - $10,286.62 = $34,713.38 ( amount of out standing loan left)

Year 2: $34,713.38 ( $12,986.62( second payment ) - $12,082.80 (Interest 6% on $34,713.38) = $34,713.38 - $10,903.81= $23,809.57 (amount of outstanding loan left)

Year 3: $23,809.57- ($12,986.62 ( third payment) - $1,428.57 (Interest 6% on $23,809.57) = $23,809.57- $11,558.04 = $12,251.53 (amount of outstanding loan left)

Year 4: $12,521.53- ($12,986.62( fourth payment)- $735.09 ( interest 6% on $12,251.53) = $12,251.53 - $12,251.53= $0 The loan is fully paid. With reference to schedule

Payment Payment number Year 1 Year 2 Year 3 Year 4 amount $12,986.62 $12,986.62 $12,986.62 $12,986.62

Payment to interest $2,700.00 $2,082.80 $1,428.57 $735.09

Payment to principal $10,286.62 $10,903.81 $11,558.04 $12,251.53

Total paid

Total paid

Left topay

to principal to interest $10,286.62 $2,700.00 $21,190.43 $4,782.80 $32,748.47 $6,211.38 $45,000.00 $61,946.47 $34,713.38 $23,809.57 $12,251.53 $0.00

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Answer 7( ii)

1, you want know exactly what your credit balance is. Having this schedule you can also find your equity if you have a RE loan or a car debt, all you have to do is to estimate the current value of your property.

2, when it comes to real estate or business loan the rate of interest and the exact amount of money you pay for interest are very important , because will take the amount of interest paid as a deduction to your income taxes.

3, the amount of principal to loan payment can be real revelation. We all know that the extra payment in the early year of the loan have a huge impact on the duration of the loan , while if we make them on the latest years they have almost zero impact.

4, loan amortization schedule can be done for many different options to know exactly how the loan term and pay off would be changed. There could be included extra payment, different duration and changed interest rates, for combination of those for the refinancing of the loan.

5, for business the amortization schedule can offer essential data foe the forecasting, expenses including, here the taxes. In order to keep a business profitable we should avoid financial surprises.

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