a.1: What is the present value of the debt?

b.1: What single sum amount must the company deposit on January 1 of this year?

b.2: What is the total amount of interest revenue that will be earned?

c.1: What is the present value of this obligation?

d.1: What is the amount of each of the equal annual payments that will be paid on the note?

d.2: What is the total amount of interest expense that will be incurred?

P9-10 (Algo) Computing Present Values LO9-7, 9-8 [The following information applies to the questions displayed below.] On January 1, Boston Company completed the following transactions (use a 7% annual interest rate for all transactions): ( FV of $1,PV of $1, FVA of $1, and PVA of $1 ) Note: Use appropriate factor(s) from the tables provided. a. Promised to pay a fixed amount of $6,400 at the end of each year for seven years and a one-time payment of $115,800 at the end of the 7th year. b. Established a plant remodeling fund of $490,600 to be available at the end of Year 8 . A single sum that will grow to $490,600 will be deposited on January 1 of this year. c. Agreed to pay a severance package to a discharged employee. The company will pay $75,400 at the end of the first year, $112,900 at the end of the second year, and $150,400 at the end of the third year. d. Purchased a $172,000 machine on January 1 of this year for $34,400 cash. A five-year note is signed for the balance. The note will be paid in five equal year-end payments starting on December 31 of this year. P9-10 (Algo) Computing Present Values LO9-7, 9-8 [The following information applies to the questions displayed below.] On January 1, Boston Company completed the following transactions (use a 7% annual interest rate for all transactions): ( FV of $1,PV of $1, FVA of $1, and PVA of $1 ) Note: Use appropriate factor(s) from the tables provided. a. Promised to pay a fixed amount of $6,400 at the end of each year for seven years and a one-time payment of $115,800 at the end of the 7th year. b. Established a plant remodeling fund of $490,600 to be available at the end of Year 8 . A single sum that will grow to $490,600 will be deposited on January 1 of this year. c. Agreed to pay a severance package to a discharged employee. The company will pay $75,400 at the end of the first year, $112,900 at the end of the second year, and $150,400 at the end of the third year. d. Purchased a $172,000 machine on January 1 of this year for $34,400 cash. A five-year note is signed for the balance. The note will be paid in five equal year-end payments starting on December 31 of this year