KL-JB Berhad wishes to accumulate funds to provide a retirement annuity for its Chief of Finance Officer (CFO) Mr. TJ Wong. Mr. Wong by contract will retire at the end of exactly 12 years. On retirement, he is entitled to receive an annual end-of-year payment of $42,000 for exactly 20 years. If he dies prior to the end of the 20-year period, the annual payments will pass to his heirs. During the 12-year 'accumulation period', KL-JB Berhad wishes to fund the annuity by making equal annual end-of-year deposits into an account earning 9 percent interest. Once the 20-year 'distribution period' begins, KL-JB Berhad plans to move the accumulated monies into an account earning a guaranteed 12 percent per year. At the end of the distribution period the account balance will equal zero. Note that the first deposit will be made at the end of year 1 and the first distribution payment will be received at the end of year 13.

i) How large must KL-JB Berhad's equal annual end-of-year deposits into the account be over the 12-year accumulation period to fund fully Mr. Wong's retirement annuity? (5 marks)

ii) How much would KL-JB Berhad have to deposit annually during the accumulation period if Mr. Wong's retirement annuity was perpetuity and all other terms were the same as initially described? (5 marks)