At the end of each year, you plan to deposit $2,000 in a savings account. The account will earn 9 percent annual interest, which will be added to the fund balance at year-end. The first deposit will be made at the end of Year 1. (FV of $1, PV of $1, FVA of $1, and PVA of $1)

Note: Use the appropriate factor(s) from the tables provided.

Required:

Assume you follow GAAP. Prepare the required journal entry at the end of Year 1.

What will be the balance in the savings account at the end of the 10th year (i.e., after 10 deposits)?

What is the interest earned on the 10 deposits?

How much interest revenue did the fund earn in the second year? In the third year?

Assume you follow GAAP. Prepare the all required journal entries at the end of the second and third years.