Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Please help with the below financial accounting problems :(( 1. If you wish to accumulate $140,000 in 20 years, how much must you deposit today

Please help with the below financial accounting problems :((

1. If you wish to accumulate $140,000 in 20 years, how much must you deposit today in an account that pays an annual interest rate of 12%?

2. If you wish to accumulate $135,000 in 10 years, how much must you deposit today in an account that pays annual interest rate of 14%, with semi-annual compounding of interest?

3. If you deposit $15,500 per year for 9 years in an account that pays an annual interest rate of 10%, what will your account be worth at the end of 9 years?

4. If you deposit $5,000 semi-annually for 5 years in an account that pays an annual interest rate of 10%, what will your account be worth at the end of 5 years?

5. You decide that you need $60,000 in 4.5 years in order to make a down payment on a house. You plan to make semi-annual deposits to achieve your goal. If interest rate is 8%, how much should be deposited each time?

6. You owe $25,000 to your parents for funding some of your college. You promise to make 5 annual payments of $6,750 to settle your debt. Approximately what interest rate are your parents charging, if you make the 5 payments beginning one year from now?

7. You are offered an investment that will pay $24,000 per year for 7 years. If you feel that the appropriate discount rate is 11%, what is the investment worth to you today?

8. You have a rich uncle who has offered you some money upon successfully completing your accounting course. Assuming an annual interest rate of 8%, which alternative should you choose? Show your work for each alternative

a. $30,000 now

b. $6,000 a year for 6 years, with the first payment at the end of the first year

c. $4,000 a year for 5 years with the first payment made at the end of year 1, and then $19,000 at the end of the 6th year.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Green Energy Audit Of Buildings A Guide For A Sustainable Energy Audit Of Buildings

Authors: Giuliano Dall’O’

2013 Edition

1447161726, 978-1447161721

More Books

Students also viewed these Accounting questions