Answer:
The new principal after the first payment is $ 1,380.65
Step-by-step explanation:
1. We calculate the amount of interest to pay in the first payment, this way:
Interest = Amount of loan * (interest rate/months in a year)
Replacing with the real values we know:
Interest = 1,500 * (0.1/12)
Interest = 1500 * 0.0083 = $ 12.50
2. Now we subtract the Interest from the monthly payment, as follows:
Payment to principal = 131.85 - 12.50
Payment to principal = $ 119.35
3. Finally we subtract that 1st payment to principal from the initial principal to get the new principal, this way:
New Principal = 1,500 - 119.35
New Principal = $ 1,380.65
The new principal after the first payment is $ 1,380.65
