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On January 1, 2014, Spearfish Company completed the following transactions (use an 8 percent annual interest rate for all transactions). a. Deposited $50,000 in a

On January 1, 2014, Spearfish Company completed the following transactions (use an 8 percent annual interest rate for all transactions).

a.

Deposited $50,000 in a debt retirement fund. Interest will be computed at six-month intervals and added to the fund at those times (i.e., semiannual compounding). (Hint: Think carefully about n and i.)

b.

Established a pension retirement fund to be available by the end of year 6 by making six annual deposits of $130,000 at year-end, starting on December 31, 2014.

c.

Deposited $250,000 in a debt retirement fund. Interest will be computed annually and added to the fund at those times.

2-a.In transaction (b), what is the amount of the retirement fund at the end of year 6?

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

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