Scribd
Upload
8 views8 pages

Installment Purchase Analysis for Land

This document is an assignment on installment purchase for a business mathematics class. It discusses a student's selection of a plot of agricultural land in Kuala Nerang, Malaysia to open a restaurant. The land is 6.731 acres and costs RM400,000. The student analyzes taking out a loan from RHB Bank or CIMB Bank to finance the purchase. RHB Bank offers a lower interest rate and lower original balance, so the student determines RHB Bank is the right financing choice. In the end, the student concludes purchasing the land and financing it through installment will allow their business to expand in a strategic location while paying for it over time.

Uploaded by

Nur Nabila Natasya Razif
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
8 views8 pages

Installment Purchase Analysis for Land

This document is an assignment on installment purchase for a business mathematics class. It discusses a student's selection of a plot of agricultural land in Kuala Nerang, Malaysia to open a restaurant. The land is 6.731 acres and costs RM400,000. The student analyzes taking out a loan from RHB Bank or CIMB Bank to finance the purchase. RHB Bank offers a lower interest rate and lower original balance, so the student determines RHB Bank is the right financing choice. In the end, the student concludes purchasing the land and financing it through installment will allow their business to expand in a strategic location while paying for it over time.

Uploaded by

Nur Nabila Natasya Razif
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

KOLEJ PROFESSIONAL MARA SERI ISKANDAR

JUN-SEPT 2020
BUSINESS MATHEMATICS
MAT 1013
DIPLOMA IN MARKETING
NAME : HARIZ AIMAN BIN ABDUL PUHAT (SMK20071482)
MUHAMMAD NAZIM BIN RAZIF (SMK20071695)

CLASS : DMK 1A
TITLE OF ASSIGNMENT : INSTALLMENT PURCHASE
ASSESSOR : MADAM RAFTAH BINTI MAD KAPOT
STUDENT DECLARATION
We hereby declare the work contained in this assignment is uniquely prepared by us. We also
confirm that the assignment is only prepared for my academic requirement not for any other
purpose. We authorize the college to test any work submitted by us.

DATE : 7 OCTOBER 2020


SIGNATURE :
1
B) URL Website : [Link]
nerang/kampung-genting-palas/sale-100834612/

C) Picture of Land :

3
Detail of the chosen land:
Property type:
Agriculture Land

Land Title:
Agriculture

Proper Title Type :

Individual

Bumi Lot :

Yes

Tenure :

Malay reserved land

Land Area size :

6.731 acres

Land Area price :

RM7.33 per [Link].

Reference Number :

100834612

Facing Direction :

North

D) Price of the land :


RM400,000
E) Reason why we chose the land :
Strategic places:
 Near to education centre
 Many facilities

4
F)
RHB CIMB Bank
Rate of interest: 3.6% (effective rate) 4.12% (effective rate)
Duration of payment 35 Years 35 Years
Number of Payment 420 420
G) The Original Balance
RHB CIMB Bank
Original Balance RM400,000- RM400000-
(400,000 x 10%) (400000 x 8%)
= RM360,000 RM368,000
FOR INTEREST CHARGE BASED ON ORIGINAL BALANCE
H) Amount of Interest Paid
I = Prt
P = RM 360 000
R = 3.6%
T = 35 Years
RM 360 000 x 3.6% x 35% years
=RM 453 600
I)Monthly Payment
Original Balance + Total interest
Number of Payment
RM 360 000 + RM 453 600
420 = RM 1937.14
5
J) Installment Price
Cash Price + Total Interest
RM400,000 + RM453,600
= RM 853,600
For Interest Based On Reducing Balance
K) Amount Of Interest Paid
I = nR – A
= (420)(887.64) – 360 000
= RM12808.80
L) Monthly Payment, R
1 + r = (1 +k/m)^m
1 + 0.03 = (1 + k/12)12
k = 0.0296
R = Ai/1 – (1+i)^-n
= RM 360 000(0.0296/12)/1-(1+0.0296/12)^-420
= RM887.64
M) Instalment Price
Cash Price + Total Interest
RM 400 000 + RM 12808.80
= RM 412 808.8

6
Decision Making
N) The Right Decision
-We decided to choose loan from RHB because RHB give
us low rate compare to CIMB Bank. Other than that, the
original balance of RHB is lower than CIMB Bank. So, the
option of choosing RHB is suitable because the price is
reasonable.
O) Summarize & Opinion
We choose the land from Kuala Nerang is because we plan to
expand our business there. Our main idea of business is
opening a restaurant . The benefits of choosing this land to
open the restaurant is that there are many people residing
here so it is perfect for us to run a restaurant here. The
advantages to apply the instalment purchase is we do not
need to pay lump sum, so we just pay for monthly and it is
easier for us to spend our money on our business.
7

References
[Link]
nerang/kampung-genting-palas/sale-100834612/

[Link]
pinjaman-ekspres

Business Mathematics MAT 1013


ANIZA ALIAS
KOLEJ PROFESIONAL MARA BERANANG, SELANGOR
8

You might also like