1. 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 deposited at the beginning of each year to accumulate to $13,000 in two years if interest is at 9%?

2. John Roberts is 43 years old and has been asked to accept early retirement from his company. On July 1, the company offered John three alternative compensation packages to induce John to retire: (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) 1. $231,000 cash payment to be paid immediately. 2. A 20-year annuity of $22,000 beginning immediately. 3. A 10-year annuity of $75,000 beginning on July 1 of the year John reaches age 53 (after 10 years). Required: Determine the present value, assuming that he is able to invest funds at a 8% rate, which alternative should John choose?

3. Incognito Company is contemplating the purchase of a machine that provides it with cash savings of $88,000 per year for five years. Interest is 10%. Assume the cash savings occur at the end of each year. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: Calculate the present value of the cash savings. (Round your final answer to the nearest whole dollar.)

4. What is the effective interest rate (rounded) on a 3-month, noninterest-bearing note with a stated rate of 12.3% and a maturity value of $203,000? (Do not round intermediate calculations. Round final answer to one decimal place, e.g., 0.123 as 12.3%.)

5. During 2018, Deluxe Leather Goods issued 862,000 coupons which entitles the customer to a $6.00 cash refund when the coupon is submitted at the time of any future purchase. Deluxe estimates that 72% of the coupons will be redeemed. 319,000 coupons had been processed during 2018. At December 31, 2018, Deluxe should report a liability for unredeemed coupons of:

Multiple Choice $1,809,840. $3,258,000. $620,640. $2,345,760.

6. On September 1, 2018, Hiker Shoes issued a $109,000, 6-month, noninterest-bearing note. The loan was made by Second Commercial Bank where the stated discount rate is 11%. Hiker's effective interest rate on this loan (rounded) is: (Do not round intermediate calculations. Round your final answer to two decimal places, e.g., .1234 as 12.34%.)

Multiple Choice 11.00%. 11.56%. 11.57%. 11.64%