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Sheet1

NEWS has decided to purchase a new parcel of land in order to expand operations into a brand-new facility and retake the competitive advantage.
The Amortization Schedule below has been generated for your use in this assignment and in future professional/personal endeavors.
NOTE: Payment is calculated by using the PMT function in Excel, based on a given interest rate, total periods, present value borrowed (-), and future value
Question 1: NEWS would like to compare two different parcels, each of which is tied to a specific lender and the lender's terms.
Parcel GREEN has the following conditions: Cost = $ 10,000,000; Annual Interest Rate = 11%; Loan Term = 25 Years
Parcel BLUE has the following conditions: Cost = $ 7,500,000; Annual Interest Rate = 20%; Loan Term = 15 Years
Provide your recommendation on which option is the best option and why.
ANSWER:
Question 2: How does your answer change if NEWS is concerned with short-term profit margins?
How does your answer change if NEWS is concerned with long-term debt, due to a poor book value rating from the most recent stock analyst?
ANSWER:
Amount Borrowed (Present Value) Amount Borrowed (Present Value)
Future Value $ - 0 Future Value $ - 0
Years Years
Payments per Year 12 Payments per Year 12
Total Periods 0 Total Periods 0
Annual Interest Rate Annual Interest Rate
Compound Rate 0.00% Compound Rate 0.00%
Payment Amount ERROR:#NUM! Payment Amount ERROR:#NUM!
Payment Number Payment Interest Principal Balance Payment Number Payment Interest Principal Balance
1 $0.00 $ - 0 $ - 0 $ - 0 1 $0.00 $ - 0 $0.00 $ - 0
2 $0.00 $ - 0 $ - 0 $ - 0 2 $0.00 $ - 0 $0.00 $ - 0
3 $0.00 $ - 0 $ - 0 $ - 0 3 $0.00 $ - 0 $0.00 $ - 0
4 $0.00 $ - 0 $ - 0 $ - 0 4 $0.00 $ - 0 $0.00 $ - 0
5 $0.00 $ - 0 $ - 0 $ - 0 5 $0.00 $ - 0 $0.00 $ - 0
6 $0.00 $ - 0 $ - 0 $ - 0 6 $0.00 $ - 0 $0.00 $ - 0
7 $0.00 $ - 0 $ - 0 $ - 0 7 $0.00 $ - 0 $0.00 $ - 0
8 $0.00 $ - 0 $ - 0 $ - 0 8 $0.00 $ - 0 $0.00 $ - 0
9 $0.00 $ - 0 $ - 0 $ - 0 9 $0.00 $ - 0 $0.00 $ - 0
10 $0.00 $ - 0 $ - 0 $ - 0 10 $0.00 $ - 0 $0.00 $ - 0
11 $0.00 $ - 0 $ - 0 $ - 0 11 $0.00 $ - 0 $0.00 $ - 0
12 $0.00 $ - 0 $ - 0 $ - 0 12 $0.00 $ - 0 $0.00 $ - 0
13 $0.00 $ - 0 $ - 0 $ - 0 13 $0.00 $ - 0 $0.00 $ - 0
14 $0.00 $ - 0 $ - 0 $ - 0 14 $0.00 $ - 0 $0.00 $ - 0
15 $0.00 $ - 0 $ - 0 $ - 0 15 $0.00 $ - 0 $0.00 $ - 0
16 $0.00 $ - 0 $ - 0 $ - 0 16 $0.00 $ - 0 $0.00 $ - 0
17 $0.00 $ - 0 $ - 0 $ - 0 17 $0.00 $ - 0 $0.00 $ - 0
18 $0.00 $ - 0 $ - 0 $ - 0 18 $0.00 $ - 0 $0.00 $ - 0
19 $0.00 $ - 0 $ - 0 $ - 0 19 $0.00 $ - 0 $0.00 $ - 0
20 $0.00 $ - 0 $ - 0 $ - 0 20 $0.00 $ - 0 $0.00 $ - 0
21 $0.00 $ - 0 $ - 0 $ - 0 21 $0.00 $ - 0 $0.00 $ - 0
22 $0.00 $ - 0 $ - 0 $ - 0 22 $0.00 $ - 0 $0.00 $ - 0
23 $0.00 $ - 0 $ - 0 $ - 0 23 $0.00 $ - 0 $0.00 $ - 0
24 $0.00 $ - 0 $ - 0 $ - 0 24 $0.00 $ - 0 $0.00 $ - 0
25 $0.00 $ - 0 $ - 0 $ - 0 25 $0.00 $ - 0 $0.00 $ - 0
26 $0.00 $ - 0 $ - 0 $ - 0 26 $0.00 $ - 0 $0.00 $ - 0
27 $0.00 $ - 0 $ - 0 $ - 0 27 $0.00 $ - 0 $0.00 $ - 0
28 $0.00 $ - 0 $ - 0 $ - 0 28 $0.00 $ - 0 $0.00 $ - 0
29 $0.00 $ - 0 $ - 0 $ - 0 29 $0.00 $ - 0 $0.00 $ - 0
30 $0.00 $ - 0 $ - 0 $ - 0 30 $0.00 $ - 0 $0.00 $ - 0
31 $0.00 $ - 0 $ - 0 $ - 0 31 $0.00 $ - 0 $0.00 $ - 0
32 $0.00 $ - 0 $ - 0 $ - 0 32 $0.00 $ - 0 $0.00 $ - 0
33 $0.00 $ - 0 $ - 0 $ - 0 33 $0.00 $ - 0 $0.00 $ - 0
34 $0.00 $ - 0 $ - 0 $ - 0 34 $0.00 $ - 0 $0.00 $ - 0
35 $0.00 $ - 0 $ - 0 $ - 0 35 $0.00 $ - 0 $0.00 $ - 0
36 $0.00 $ - 0 $ - 0 $ - 0 36 $0.00 $ - 0 $0.00 $ - 0
37 $0.00 $ - 0 $ - 0 $ - 0 37 $0.00 $ - 0 $0.00 $ - 0
38 $0.00 $ - 0 $ - 0 $ - 0 38 $0.00 $ - 0 $0.00 $ - 0
39 $0.00 $ - 0 $ - 0 $ - 0 39 $0.00 $ - 0 $0.00 $ - 0
40 $0.00 $ - 0 $ - 0 $ - 0 40 $0.00 $ - 0 $0.00 $ - 0
41 $0.00 $ - 0 $ - 0 $ - 0 41 $0.00 $ - 0 $0.00 $ - 0
42 $0.00 $ - 0 $ - 0 $ - 0 42 $0.00 $ - 0 $0.00 $ - 0
43 $0.00 $ - 0 $ - 0 $ - 0 43 $0.00 $ - 0 $0.00 $ - 0
44 $0.00 $ - 0 $ - 0 $ - 0 44 $0.00 $ - 0 $0.00 $ - 0
45 $0.00 $ - 0 $ - 0 $ - 0 45 $0.00 $ - 0 $0.00 $ - 0
46 $0.00 $ - 0 $ - 0 $ - 0 46 $0.00 $ - 0 $0.00 $ - 0
47 $0.00 $ - 0 $ - 0 $ - 0 47 $0.00 $ - 0 $0.00 $ - 0
48 $0.00 $ - 0 $ - 0 $ - 0 48 $0.00 $ - 0 $0.00 $ - 0
49 $0.00 $ - 0 $ - 0 $ - 0 49 $0.00 $ - 0 $0.00 $ - 0
50 $0.00 $ - 0 $ - 0 $ - 0 50 $0.00 $ - 0 $0.00 $ - 0
51 $0.00 $ - 0 $ - 0 $ - 0 51 $0.00 $ - 0 $0.00 $ - 0
52 $0.00 $ - 0 $ - 0 $ - 0 52 $0.00 $ - 0 $0.00 $ - 0
53 $0.00 $ - 0 $ - 0 $ - 0 53 $0.00 $ - 0 $0.00 $ - 0
54 $0.00 $ - 0 $ - 0 $ - 0 54 $0.00 $ - 0 $0.00 $ - 0
55 $0.00 $ - 0 $ - 0 $ - 0 55 $0.00 $ - 0 $0.00 $ - 0
56 $0.00 $ - 0 $ - 0 $ - 0 56 $0.00 $ - 0 $0.00 $ - 0
57 $0.00 $ - 0 $ - 0 $ - 0 57 $0.00 $ - 0 $0.00 $ - 0
58 $0.00 $ - 0 $ - 0 $ - 0 58 $0.00 $ - 0 $0.00 $ - 0
59 $0.00 $ - 0 $ - 0 $ - 0 59 $0.00 $ - 0 $0.00 $ - 0
60 $0.00 $ - 0 $ - 0 $ - 0 60 $0.00 $ - 0 $0.00 $ - 0
61 $0.00 $ - 0 $ - 0 $ - 0 61 $0.00 $ - 0 $0.00 $ - 0
62 $0.00 $ - 0 $ - 0 $ - 0 62 $0.00 $ - 0 $0.00 $ - 0
63 $0.00 $ - 0 $ - 0 $ - 0 63 $0.00 $ - 0 $0.00 $ - 0
64 $0.00 $ - 0 $ - 0 $ - 0 64 $0.00 $ - 0 $0.00 $ - 0
65 $0.00 $ - 0 $ - 0 $ - 0 65 $0.00 $ - 0 $0.00 $ - 0
66 $0.00 $ - 0 $ - 0 $ - 0 66 $0.00 $ - 0 $0.00 $ - 0
67 $0.00 $ - 0 $ - 0 $ - 0 67 $0.00 $ - 0 $0.00 $ - 0
68 $0.00 $ - 0 $ - 0 $ - 0 68 $0.00 $ - 0 $0.00 $ - 0
69 $0.00 $ - 0 $ - 0 $ - 0 69 $0.00 $ - 0 $0.00 $ - 0
70 $0.00 $ - 0 $ - 0 $ - 0 70 $0.00 $ - 0 $0.00 $ - 0
71 $0.00 $ - 0 $ - 0 $ - 0 71 $0.00 $ - 0 $0.00 $ - 0
72 $0.00 $ - 0 $ - 0 $ - 0 72 $0.00 $ - 0 $0.00 $ - 0
73 $0.00 $ - 0 $ - 0 $ - 0 73 $0.00 $ - 0 $0.00 $ - 0
74 $0.00 $ - 0 $ - 0 $ - 0 74 $0.00 $ - 0 $0.00 $ - 0
75 $0.00 $ - 0 $ - 0 $ - 0 75 $0.00 $ - 0 $0.00 $ - 0
76 $0.00 $ - 0 $ - 0 $ - 0 76 $0.00 $ - 0 $0.00 $ - 0
77 $0.00 $ - 0 $ - 0 $ - 0 77 $0.00 $ - 0 $0.00 $ - 0
78 $0.00 $ - 0 $ - 0 $ - 0 78 $0.00 $ - 0 $0.00 $ - 0
79 $0.00 $ - 0 $ - 0 $ - 0 79 $0.00 $ - 0 $0.00 $ - 0
80 $0.00 $ - 0 $ - 0 $ - 0 80 $0.00 $ - 0 $0.00 $ - 0
81 $0.00 $ - 0 $ - 0 $ - 0 81 $0.00 $ - 0 $0.00 $ - 0
82 $0.00 $ - 0 $ - 0 $ - 0 82 $0.00 $ - 0 $0.00 $ - 0
83 $0.00 $ - 0 $ - 0 $ - 0 83 $0.00 $ - 0 $0.00 $ - 0
84 $0.00 $ - 0 $ - 0 $ - 0 84 $0.00 $ - 0 $0.00 $ - 0
85 $0.00 $ - 0 $ - 0 $ - 0 85 $0.00 $ - 0 $0.00 $ - 0
86 $0.00 $ - 0 $ - 0 $ - 0 86 $0.00 $ - 0 $0.00 $ - 0
87 $0.00 $ - 0 $ - 0 $ - 0 87 $0.00 $ - 0 $0.00 $ - 0
88 $0.00 $ - 0 $ - 0 $ - 0 88 $0.00 $ - 0 $0.00 $ - 0
89 $0.00 $ - 0 $ - 0 $ - 0 89 $0.00 $ - 0 $0.00 $ - 0
90 $0.00 $ - 0 $ - 0 $ - 0 90 $0.00 $ - 0 $0.00 $ - 0
91 $0.00 $ - 0 $ - 0 $ - 0 91 $0.00 $ - 0 $0.00 $ - 0
92 $0.00 $ - 0 $ - 0 $ - 0 92 $0.00 $ - 0 $0.00 $ - 0
93 $0.00 $ - 0 $ - 0 $ - 0 93 $0.00 $ - 0 $0.00 $ - 0
94 $0.00 $ - 0 $ - 0 $ - 0 94 $0.00 $ - 0 $0.00 $ - 0
95 $0.00 $ - 0 $ - 0 $ - 0 95 $0.00 $ - 0 $0.00 $ - 0
96 $0.00 $ - 0 $ - 0 $ - 0 96 $0.00 $ - 0 $0.00 $ - 0
97 $0.00 $ - 0 $ - 0 $ - 0 97 $0.00 $ - 0 $0.00 $ - 0
98 $0.00 $ - 0 $ - 0 $ - 0 98 $0.00 $ - 0 $0.00 $ - 0
99 $0.00 $ - 0 $ - 0 $ - 0 99 $0.00 $ - 0 $0.00 $ - 0
100 $0.00 $ - 0 $ - 0 $ - 0 100 $0.00 $ - 0 $0.00 $ - 0
101 $0.00 $ - 0 $ - 0 $ - 0 101 $0.00 $ - 0 $0.00 $ - 0
102 $0.00 $ - 0 $ - 0 $ - 0 102 $0.00 $ - 0 $0.00 $ - 0
103 $0.00 $ - 0 $ - 0 $ - 0 103 $0.00 $ - 0 $0.00 $ - 0
104 $0.00 $ - 0 $ - 0 $ - 0 104 $0.00 $ - 0 $0.00 $ - 0
105 $0.00 $ - 0 $ - 0 $ - 0 105 $0.00 $ - 0 $0.00 $ - 0
106 $0.00 $ - 0 $ - 0 $ - 0 106 $0.00 $ - 0 $0.00 $ - 0
107 $0.00 $ - 0 $ - 0 $ - 0 107 $0.00 $ - 0 $0.00 $ - 0
108 $0.00 $ - 0 $ - 0 $ - 0 108 $0.00 $ - 0 $0.00 $ - 0
109 $0.00 $ - 0 $ - 0 $ - 0 109 $0.00 $ - 0 $0.00 $ - 0
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111 $0.00 $ - 0 $ - 0 $ - 0 111 $0.00 $ - 0 $0.00 $ - 0
112 $0.00 $ - 0 $ - 0 $ - 0 112 $0.00 $ - 0 $0.00 $ - 0
113 $0.00 $ - 0 $ - 0 $ - 0 113 $0.00 $ - 0 $0.00 $ - 0
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120 $0.00 $ - 0 $ - 0 $ - 0 120 $0.00 $ - 0 $0.00 $ - 0