Question
1. Present and future value tables of $1 at 3% are presented below N FV $1 PV $1 FVA $1 PVA $1 FVAD $1 PVAD
1. Present and future value tables of $1 at 3% are presented below |
N | FV $1 | PV $1 | FVA $1 | PVA $1 | FVAD $1 | PVAD $1 |
1 | 1.03000 | 0.97087 | 1.0000 | 0.97087 | 1.0300 | 1.00000 |
2 | 1.06090 | 0.94260 | 2.0300 | 1.91347 | 2.0909 | 1.97087 |
3 | 1.09273 | 0.91514 | 3.0909 | 2.82861 | 3.1836 | 2.91347 |
4 | 1.12551 | 0.88849 | 4.1836 | 3.71710 | 4.3091 | 3.82861 |
5 | 1.15927 | 0.86261 | 5.3091 | 4.57971 | 5.4684 | 4.71710 |
6 | 1.19405 | 0.83748 | 6.4684 | 5.41719 | 6.6625 | 5.57971 |
7 | 1.22987 | 0.81309 | 7.6625 | 6.23028 | 7.8923 | 6.41719 |
8 | 1.26677 | 0.78941 | 8.8923 | 7.01969 | 9.1591 | 7.23028 |
9 | 1.30477 | 0.76642 | 10.1591 | 7.78611 | 10.4639 | 8.01969 |
10 | 1.34392 | 0.74409 | 11.4639 | 8.53020 | 11.8078 | 8.78611 |
11 | 1.38423 | 0.72242 | 12.8078 | 9.25262 | 13.1920 | 9.53020 |
12 | 1.42576 | 0.70138 | 14.1920 | 9.95400 | 14.6178 | 10.25262 |
13 | 1.46853 | 0.68095 | 15.6178 | 10.63496 | 16.0863 | 10.95400 |
14 | 1.51259 | 0.66112 | 17.0863 | 11.29607 | 17.5989 | 11.63496 |
15 | 1.55797 | 0.64186 | 18.5989 | 11.93794 | 19.1569 | 12.29607 |
16 | 1.60471 | 0.62317 | 20.1569 | 12.56110 | 20.7616 | 12.93794 |
Today, Thomas deposited $160,000 in a 3-year, 12% CD that compounds quarterly. What is the maturity value of the CD? |
A. $174,400.
B. $228,122.
C. $342,182.
D. $308,132.
2. Present and future value tables of $1 at 3% are presented below:
N | FV $1 | PV $1 | FVA $1 | PVA $1 | FVAD $1 | PVAD $1 |
1 | 1.03000 | 0.97087 | 1.0000 | 0.97087 | 1.0300 | 1.00000 |
2 | 1.06090 | 0.94260 | 2.0300 | 1.91347 | 2.0909 | 1.97087 |
3 | 1.09273 | 0.91514 | 3.0909 | 2.82861 | 3.1836 | 2.91347 |
4 | 1.12551 | 0.88849 | 4.1836 | 3.71710 | 4.3091 | 3.82861 |
5 | 1.15927 | 0.86261 | 5.3091 | 4.57971 | 5.4684 | 4.71710 |
6 | 1.19405 | 0.83748 | 6.4684 | 5.41719 | 6.6625 | 5.57971 |
7 | 1.22987 | 0.81309 | 7.6625 | 6.23028 | 7.8923 | 6.41719 |
8 | 1.26677 | 0.78941 | 8.8923 | 7.01969 | 9.1591 | 7.23028 |
9 | 1.30477 | 0.76642 | 10.1591 | 7.78611 | 10.4639 | 8.01969 |
10 | 1.34392 | 0.74409 | 11.4639 | 8.53020 | 11.8078 | 8.78611 |
11 | 1.38423 | 0.72242 | 12.8078 | 9.25262 | 13.1920 | 9.53020 |
12 | 1.42576 | 0.70138 | 14.1920 | 9.95400 | 14.6178 | 10.25262 |
13 | 1.46853 | 0.68095 | 15.6178 | 10.63496 | 16.0863 | 10.95400 |
14 | 1.51259 | 0.66112 | 17.0863 | 11.29607 | 17.5989 | 11.63496 |
15 | 1.55797 | 0.64186 | 18.5989 | 11.93794 | 19.1569 | 12.29607 |
16 | 1.60471 | 0.62317 | 20.1569 | 12.56110 | 20.7616 | 12.93794 |
Jose wants to cash in his winning lottery ticket. He can either receive twelve, $8,000 annual payments starting today, or he can receive a lump-sum payment now based on a 3% annual interest rate. What would be the lump-sum payment? |
A. $82,021.
B. $77,911.
C. $80,300.
D. $79,632.
3. Present and future value tables of 1 at 9% are presented below.
PV of $1 | FV of $1 | PVA of $1 | FVAD of $1 | FVA of $1 | |
1 | 0.91743 | 1.09000 | 0.91743 | 1.0900 | 1.0000 |
2 | 0.84168 | 1.18810 | 1.75911 | 2.2781 | 2.0900 |
3 | 0.77218 | 1.29503 | 2.53129 | 3.5731 | 3.2781 |
4 | 0.70843 | 1.41158 | 3.23972 | 4.9847 | 4.5731 |
5 | 0.64993 | 1.53862 | 3.88965 | 6.5233 | 5.9847 |
6 | 0.59627 | 1.67710 | 4.48592 | 8.2004 | 7.5233 |
Ajax Company purchased a two-year certificate of deposit for its building fund in the amount of $200,000. How much should the certificate of deposit be worth at the end of two years if interest is compounded at an annual rate of 9%? |
A. $350,563.
B. $236,361.
C. $237,620.
D. $351,822.
4. Present and future value tables of 1 at 9% are presented below.
PV of $1 | FV of $1 | PVA of $1 | FVAD of $1 | FVA of $1 | |
1 | 0.91743 | 1.09000 | 0.91743 | 1.0900 | 1.0000 |
2 | 0.84168 | 1.18810 | 1.75911 | 2.2781 | 2.0900 |
3 | 0.77218 | 1.29503 | 2.53129 | 3.5731 | 3.2781 |
4 | 0.70843 | 1.41158 | 3.23972 | 4.9847 | 4.5731 |
5 | 0.64993 | 1.53862 | 3.88965 | 6.5233 | 5.9847 |
6 | 0.59627 | 1.67710 | 4.48592 | 8.2004 | 7.5233 |
How much must be invested now at 9% interest to accumulate to $21,000 in four years? |
A. $12,255.
B. $14,877.
C. $12,522.
D. $14,610.
5. Present and future value tables of 1 at 9% are presented below.
|
PV of $1 | FV of $1 | PVA of $1 | FVAD of $1 | FVA of $1 | |
1 | 0.91743 | 1.09000 | 0.91743 | 1.0900 | 1.0000 |
2 | 0.84168 | 1.18810 | 1.75911 | 2.2781 | 2.0900 |
3 | 0.77218 | 1.29503 | 2.53129 | 3.5731 | 3.2781 |
4 | 0.70843 | 1.41158 | 3.23972 | 4.9847 | 4.5731 |
5 | 0.64993 | 1.53862 | 3.88965 | 6.5233 | 5.9847 |
6 | 0.59627 | 1.67710 | 4.48592 | 8.2004 | 7.5233 |
Claudine Corporation will deposit $6,100 into a money market sinking fund at the end of each year for the next five years. How much will accumulate by the end of the fifth and final payment if the sinking fund earns 9% interest? |
A. $39,792.
B. $36,507.
C. $33,245.
D. $32,696.
6. Present and future value tables of 1 at 11% are presented below.
PV of $1 | FV of $1 | PVA of $1 | FVA of $1 | |
1 | 0.90090 | 1.11000 | 0.90090 | 1.0000 |
2 | 0.81162 | 1.23210 | 1.71252 | 2.1100 |
3 | 0.73119 | 1.36763 | 2.44371 | 3.3421 |
4 | 0.65873 | 1.51807 | 3.10245 | 4.7097 |
5 | 0.59345 | 1.68506 | 3.69590 | 6.2278 |
6 | 0.53464 | 1.87041 | 4.23054 | 7.9129 |
Spielberg Inc. signed a $280,000 noninterest-bearing note due in five years from a production company eager to do business. Comparable borrowings have carried an 11% interest rate. What is the value of this debt at its inception? |
A. $249,200.
B. $166,166.
C. $310,800.
D. $280,000.
7. Present and future value tables of 1 at 11% are presented below.
PV of $1 | FV of $1 | PVA of $1 | FVA of $1 | |
1 | 0.90090 | 1.11000 | 0.90090 | 1.0000 |
2 | 0.81162 | 1.23210 | 1.71252 | 2.1100 |
3 | 0.73119 | 1.36763 | 2.44371 | 3.3421 |
4 | 0.65873 | 1.51807 | 3.10245 | 4.7097 |
5 | 0.59345 | 1.68506 | 3.69590 | 6.2278 |
6 | 0.53464 | 1.87041 | 4.23054 | 7.9129 |
On October 1, 2016, Justine Company purchased equipment from Napa Inc. in exchange for a noninterest-bearing note payable in four equal annual payments of $580,000, beginning Oct 1, 2017. Similar borrowings have carried an 11% interest rate. The equipment would be recorded at: |
A. $2,320,000.
B. $1,799,421.
C. $2,064,800.
D. $2,143,622.
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