As a result of a slowdown in operations, Tradewind Stores is offering employees who have been terminated a severance package of $105,000 cash paid today; $105,000 to be paid in one year; and an annuity of $37,000 to be paid each year for 8 years.

Required:

What is the present value of the package assuming an interest rate of 11 percent? (Future Value of $1, Present Value of $1, Future Value Annuity of $1, Present Value Annuity of $1.)

Note: Use appropriate factor(s) from the tables provided. Round the final answer to nearest whole dollar.

LE 11.1A Future Value of $1 TABLE 11.2A Present Value of $1 TABLE 11.3A Future Value of an Annuity of $1 TABLE 11.4A Present Value of Annuity of $1