Question

installment loan
principal $2,240
term length 2 ½ years
interest rate 15%
monthly payment $90
how much of the 11th payment will go to interest if there is an outstanding principal of $1,584?
interest on 11th payment = $?

Explanation:

Step1: Convert annual interest rate to monthly

The annual interest rate is 15%, so the monthly interest rate $r$ is $\frac{15\%}{12}=\frac{0.15}{12} = 0.0125$.

Step2: Calculate interest on outstanding principal

The outstanding principal before the 11th payment is $1584$. The interest portion of the payment is calculated as $I = P\times r$, where $P$ is the outstanding principal and $r$ is the monthly interest rate. So $I = 1584\times0.0125$.
$1584\times0.0125 = \frac{1584}{80}=19.8$

Answer:

19.8