Exercise B-1 Present value of an amount LO P1 Mike Der Company expects to earn 8% per year on an investment that will pay $606,000 five years from now. (PV of $1. FV of $1. PVA of $1. and FVA of $1 (Use appropriate factor(s) from the tables provided. Round Table Factor" to 4 decimal places.) Compute the present value of this investment Future Value Table Factor Present Value Exercise B-2 Present value of an amount LO P1 On January 1, a company agrees to pay $25,000 in three years. If the annual interest rate is 8%, determine how much cash the company can borrow with this agreement. (PV of $1. FV of $1. PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round Table Factor" to 4 decimal places.) Future Value Table Factor Amount Borrowed Exercise B-3 Number of periods of an investment LO P2 Tom Thompson expects to invest $12,000 at 7% and, at the end of a certain period, receive $43,398. How many years will it be before Thompson receives the payment? (PV of $1. FV of S1, PVA of S1, and FVA of S1 (Use appropriate factor(s) from the tables provided. Round "Table Factor" to 4 decimal places.) Future Value Present Value Table Factor Years years Exercise B-4 Interest rate on an investment LO P2 Bill Padley expects to invest $20,000 for 2 years, after which he wants to receive $22,472.00. What rate of interest must Padley earn? (PV of $1. FV of $1. PVA of S1, and FVA of $1 (Use appropriate factor(s) from the tables provided. Round "Table Factor" to 4 decimal places.) Future Value Present Value Table Factor Interest Rate % Exercise B-5 Future value of an amount LO P2 Mark Welsch deposits $6,300 in an account that eams interest at an annual rate of 8%, compounded quarterly. The $6,300 plus earned interest must remain in the account 5 years before it can be withdrawn. How much money will be in the account at the end of 5 years? (PV of $1. FV of $1. PVA of $1. and FVA of S1) (Use appropriate factor(s) from the tables provided. Round Table Factor" to 4 decimal places.) Present Value Table Factor Total Accumulation HUGO Cab COUPE / tab.eb 4.JPG TABLE B.1 Present Value of 1 p=1/(1+iy Rate Periods 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 12% 15% X 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 25 30 35 40 SMS 8 WIB 0.9901 0.9803 0.9706 0.9610 0.9515 0.9420 0.9327 0.9735 09143 09053 08963 0.8874 0.8787 0.8700 0.8613 0.8528 0.8444 0.8360 0.8277 0.8195 0.7798 0.7419 0.7059 0.6717 0.9804 0.9612 0.9423 0.9238 0.9057 0.8880 0.8706 0.8535 0.8368 0.8203 0.8043 0.7885 0.7730 0.7579 0.7430 0.7284 0.7142 0.7002 0,6864 0.6730 0.6095 05521 0.5000 0.4529 0.9709 0.9426 0.9151 0.8885 0.8626 0.8375 0.8131 0.7894 0.7664 0.7441 0.7224 0.7014 0.6810 0.6611 0.5419 0.6232 0.6050 0.5874 0.5703 0.5537 0.4775 0.4120 0.3554 0.3066 0.9615 09246 0.8890 0.8548 0.8219 0.7903 0.7599 0.7307 0.7026 0.6756 0.6496 0.6246 0.6006 0.5775 0.5553 0.5339 0.5134 0.4936 0.4746 0.4564 0.3751 0.3083 0.2534 0.2083 0.9524 09070 0.8638 0.8227 0.7835 0.7462 0.7107 0.6768 0.6445 0.6139 0.5847 0.5568 0.5303 0.5051 0.4810 0.4581 0.4363 0.4155 0.3957 0.3769 0.2953 0.2314 0.1813 0.1420 0.9434 0.8900 0.8396 0.7921 0.7473 0.7050 0.6651 0.6274 0.5919 0.5584 0.5268 0.4970 0.4688 0.4423 0.4173 0.3936 0.3714 0.3503 0.3305 0.3118 0.2330 0.1741 0.1301 0.0972 0.9346 0.8734 0.8163 0.7629 0.7130 0.6663 0.6227 0.5820 0.5439 0.5083 0.4751 0.4440 0.4150 0.3878 0.3624 0.3387 0.3166 0.2959 0.2765 0.2584 0.1842 0.1314 0.0937 0.0668 0.9259 0.8573 0.7938 0.7350 0.6806 0.6302 0.5835 0.5403 05002 0.4637 0.4289 0.3971 0.3677 0.3405 0.3152 0.2919 0.2703 0.2502 0.2317 0.2145 0.1460 0.0994 0.0676 0.0460 0.9174 0.8417 0.7722 0.7084 0.6499 0.5963 0.5470 0.5019 0.4604 0.4224 0.3875 0.3555 0.3262 0.2992 0.2745 0.2519 0.2311 0.2120 0.1945 0.1784 0.1160 0.0754 0.0490 0.0318 0.9091 0.8264 0.7513 0.6830 0.6209 0.5645 0.5132 0.4665 0.4241 0.3855 0.3505 0.3186 0.2897 0.2633 0.2394 0.2176 0.1978 0.1799 0.1635 0.1486 0.0923 0.0573 0.0356 0.0221 0.8929 0.7972 0.7118 0.6355 05674 0.5066 0.4523 0.4039 0.3606 0.3220 0.2875 0.2567 0.2292 0.2046 0.1827 0.1631 0.1456 0.1300 0.1161 0.1037 0.0588 0.0334 0.0189 0.0107 0.8696 0.7561 0.6575 0.5718 0.4972 0.4323 0.3759 0.3269 0.2843 0.2472 0.2149 0.1869 0.1625 0.1413 0.1229 0.1069 0.0929 0.0808 0.0703 0.0611 0.0304 0.0151 0.0075 0.0037 Used to compute the rent value of a known future wow. For cumple: How much would you need to invest day at 10% compounded to accumulare 5.000 in 6 your frem today? Uung the factures of a 12 and 1-5% (12 semiannual periods and seminule of 5%the factor in 0.5568. You would need to e$2,784 xday CSS poox0 $568) TABLE B.2 Future Value of 1 S=(1+ Rate Periods 1% % 2% 3 3% 4% 5% 6% 7% 8% 9% 10% 12% 15% 0 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1 1.0100 1.0200 1.0300 1.0400 1.0500 1.0600 1,0700 1.0800 1.0900 1.1000 1.1200 1.1500 2 1.0201 1.0404 1.0609 1.0816 1.1025 1.1236 1.1449 1.1664 1.1881 1.2100 1.2544 1.3225 3 1.0303 1.0612 1.0927 1.1249 1.1576 1.1910 1.2250 1.2597 1.2950 1.3310 1.4049 1.5209 4 1.0406 1.0824 1.1255 1.1699 1.2155 1.2625 1.3108 1.3605 1.4116 1.4641 1.5735 1.7490 5 1.0510 1.1041 1.1593 1.2167 1.2763 1.3382 1.4026 1.4693 1.5386 1.6105 1.7623 20114 6 1.0615 1.1262 1.1941 1.2653 1.3401 14185 1.5007 1.5869 1.6771 1.7716 1.9738 23131 7 1.0721 1.1487 1.2299 1.3159 1.4071 1.5036 1.6058 1.7138 1.8280 1.9487 2.2107 26600 8 1.0829 1.1717 1.2668 1.3686 1.4775 15938 1.7182 1.8509 1.9926 21436 24760 3.0590 9 1.0937 1.1951 13048 1.4733 1.5513 1.6895 1.8385 1.9990 21719 2.3579 2.7731 3.5179 10 1.1046 1.2190 1.3439 1.4802 1.6289 1.7908 1.9672 2.1589 23674 2.5937 3.1058 40456 11 1.1157 1.2434 1.3842 1.5395 1.7103 1.8983 2.1049 23316 25804 2.8531 3.4785 4.6524 12 1.1258 1.2682 1.4258 1,6010 1.7959 20122 2.2522 25182 2.8127 3.1384 3.8960 5.3503 12 1.1381 1.2936 1.4685 1.6651 1.8856 21329 2.4098 27196 3.0658 3.4523 4.3635 6.1528 14 1.1495 1.3195 1.5125 1.7317 1.9799 2.2609 25785 2.9372 3.3417 3.7975 4.8871 7.0757 15 1.1610 1.3459 1.5580 1.8009 20789 23966 27590 3.1722 3.6425 4.1772 5.4736 8.1371 16 1.1725 1.3728 1.6047 1.8730 2. 1829 2.5404 2.9522 3.4259 3.9703 4.5950 6.1304 9.3576 17 1.1843 1.4002 1.6528 1.9479 2.2920 26928 3.1588 3.7000 4.3276 5.0645 6.8660 10.7613 18 1.1961 1.4282 1.7024 2.0258 2.4066 28543 3.3799 3.9960 4.7171 5.5599 7.6900 123755 19 1.2081 1.4568 1.7535 21068 25270 3.0256 3.6165 4.3157 5.1417 6.1159 8.6128 14.2318 20 1.2202 1.4859 18061 2 1911 2.6533 3.2071 38697 4.6610 5.6044 6.7275 9.6463 16.3665 25 1.2824 1.6405 20938 26658 3.3864 4.2919 5.4274 6.8485 8.6231 10.8347 17.0001 32.9190 30 1.3478 1.8114 24273 3.2434 4.3219 5.7435 7.6123 10.0622 13.2677 174494 29.9599 66.2118 35 1.4166 1.9999 28139 3.9461 5.5160 7.6861 10.6766 14.7853 20.4140 28.1024 52.7996 133.1755 40 1.4889 22080 32520 4.8010 7.0400 10.2857 14.9745 21.7245 31.4094 45.2593 93.0510 267.8635 Uued to compute the future value of a known present mount. For example: What is the accumulated value of 53.000 invested today se compounded quarterly for 5 years? Using the factor of a 1 ud i = 24 quartetty period and a quarterly interest rate of 200, the factor is 1 4859. The accumulated value is $4457.70 (54,000 x 1489 p=11-a+h (1) TABLE B.31 Present Value of an Annuity of 1 Rate Pedods 1% 2% 3% ** 5% 6% 7% 7% 6% 9% 10% 12% 15% 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 0.9901 1.9704 29410 3.9020 48534 5.7955 6.7282 7.6517 8.5660 9.4713 10.3676 11.2551 12.1337 13.0037 13.8651 14.7179 15.5622 16.3983 17.2260 18.0456 220232 25.8077 29.4086 32.8347 0.9804 19416 2.8839 3.8077 4.7135 5 6014 6.4720 73255 8.1622 8.9826 9.7868 10.5753 11.3484 12.1062 12.8493 13.5777 14.2919 14.9920 15.6785 16.3514 19.5235 223965 24.9986 27.3555 09709 1.9135 2.8286 3.7171 4.5797 54172 6.2303 7.0197 7.7861 8.5302 9.2526 9.954 10.6350 11.2961 11.9379 12.5611 13.1661 13.7535 14.3238 14.8775 17.4131 19.6004 21.4872 23.1148 0.9615 1.8861 2.7751 3.6299 4.4518 5.2421 6.0021 6.7327 74353 8.1109 8.7605 9.3851 9.9856 10.5631 11.1184 11.6523 12. 1657 12.6593 13.1339 13.5903 15.6221 17.2920 18.6646 19.7928 0.9524 18594 2.7232 35460 43295 5.0757 5.7864 6.4632 7.1078 7.7217 8.3064 8,8633 9.3936 9.8986 10.3797 10.8378 11.2741 11.6896 120853 12.4622 14.0939 15.3725 16.3742 17.1591 0.9434 1.8334 26730 34651 42124 4.9173 5.5824 6.2098 6.8017 7.3601 7.8869 8.3838 8.8527 9.2950 9.7122 10.1059 10.4773 10.8276 11.1581 11.4699 127834 13.7648 14.4982 15.0463 0.9346 1.8080 2.6243 3.3872 4.1002 4.7665 53893 59713 6.5152 7.0236 7.4987 7.9427 8.3577 8.7455 9.1079 9.4466 9.7632 10.0591 10.3356 10 5940 11.6536 124090 12.9477 133312 0.9259 1.7833 2.5771 3.3121 3.9927 4.6229 5.2054 57466 6.2469 6.7101 7.1390 75361 7.9038 8.2442 8.5595 8.8514 9.1216 9.3719 9.6036 9.8181 10.6748 11.2578 11.6546 11.9746 0.9174 1.7591 25313 3.2397 3.8897 4.4859 5.0330 5.5348 5.9952 64177 6.8052 7.1607 7.4869 7.7862 8.0607 8.3126 85436 8.7556 8.9501 9.1285 9.8226 10.2737 10.5668 10.7574 0.9091 1.7355 24869 3.1699 3.7908 43553 4.8684 53349 5.7590 6.1446 6.4951 6.8137 7,1034 7.3667 7.6061 7.8237 8.0216 8.2014 8.3549 8.5136 9.0770 9.4269 96442 9.7791 0.8929 1.6901 24018 3.0373 3.6048 4.1114 45638 49676 5.3282 5.6502 5.9377 6.1944 64235 6.6282 6.8109 69740 7.1196 7.2497 7.3658 7.4694 7.8431 8.0552 8.1755 8.2438 0.8696 1.6257 22832 28550 3.3522 3.7845 4.1604 4.4873 4.7716 5.0188 5.2337 5.4206 5.5831 5.7245 5.8474 5.9542 6.0472 6.1280 6.1982 6.2593 64641 6.5660 6.5166 6.6418 5 6 8 1 2 30 35 40 Uued to calculate the presents of a series of equal payments made at the end of each period. For example: What is the price value of $2,000 per your for 10 years auming mal interest of 95 F10,1-9%), the PV factor is 6,4177.52.000 per year for 10 years is the equivalent of $12.835day (52.000 x 6.11771 S=[(1 +1" - 1/1 TABLE B.4" Future Value of an Annuity of Rate Periods 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% 12% 15% 1 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 2 20100 2.0200 20300 20400 20500 2.0500 20700 2.0800 20900 21000 21200 2.1500 3 3.0301 3.0604 3.0909 3.1216 3.1525 3.1836 3.2149 3.2464 3.2781 3.3100 33744 3.4725 4 4.0604 4.1216 4.1836 4.2465 43101 43746 4.4399 4.5061 45731 4.6410 4.7793 4.9934 5 5.1010 5 2040 53091 5.4163 5.5256 5.6371 5.7507 5.8666 5.9847 6.1051 6.3528 6.7424 6 6.1520 6.3081 6.4684 6 6330 6.8019 6.9753 7.1533 73359 7.5233 7.7156 8.1152 8.7537 7 7.2135 7.4343 7.6625 7.8983 8.1420 8.3938 8.6540 8.9228 9.2004 9.4872 10.0890 11.0668 8 8.2857 8.5830 8.8923 9.2142 9.5491 9.8975 10.2598 10.6366 11.0285 11.4359 12 2997 13.7268 9 9.3685 9.7546 10.1591 10.5828 11.0266 11.4913 11.9780 12.4876 13.0210 13.5795 14.7757 16.7858 10 10.4622 10.9497 11.4639 120061 125779 13.1808 13.8164 14.4866 15.1929 15.9374 17.5487 20.3037 11 11.5668 12.1687 12.8078 13.4864 14.2068 14.9716 15.7836 16.6455 17.5603 18.5312 20.6546 24.3493 12 12.6825 13.4121 14.1920 150258 15.9171 16,8699 17.8885 18.9771 20.1407 21.3843 24.1331 29.0017 13 13 8093 14.6803 15.6178 16.6268 17.7130 18.8821 20.1406 21.4953 22.9534 24.5227 28.0291 34.3519 14 14 9474 15.9739 17.0863 18.2919 19.5985 21.0151 22.5505 24.2149 26.0192 27.9750 323926 40.5047 15 16.0969 17.2934 18.5989 20.0236 21.5786 23.2760 25.1290 27.1521 29.3609 31.7725 37.2797 47.5804 16 17.2579 18.6393 20.1569 21.8245 23.6575 25.6725 27.8881 30.3213 33.0034 35.9497 42.7533 55.7175 17 18.4304 20.0121 21.7616 23.6975 25.8404 28.2129 30.8402 33.7502 369737 40.5447 48.8837 65.0751 18 19.6147 21.4123 23.4144 25.6454 28 1324 30 9057 33.9990 37.4502 41.3013 45.5992 55.7497 75.8364 19 20.8109 22.8406 25.1169 27.6712 30,5390 33.7600 37.3790 41.4463 46.0185 51.1591 63.4397 88.2118 20 22.0190 24.2974 26.8704 29.7781 330660 36.7856 40.9955 45.7620 51.1601 57.2750 720524 102.4436 25 28.7432 320303 36.4593 41.6459 47.7271 543645 632490 73.1059 84.7009 98.3471 133.3339 212.7930 30 34.7849 40.5681 47.5754 56.0849 66.4388 79.0582 944608 1132832 136.3075 164.4940 241 3327 434.7451 35 41.660349.9945 60.4621 73.6522 90.3203 1114348 1382369 1723168 215.7108 271.0244 431.6675 881.1702 40 18.886460.4020 75.4013 95.0255 120.7998 154.7620 199.6351 259.0565337.8824 4125926 767.0914 1.779.0903 Uned to calculate the future value of a series of equal payments made at the end of each period. For example: What is the future value of 54.000 per year fox yeux numing an mamual interest rate of 8%? Fot (n=6,18%), the FV factor is 7.3359, 54,000 per year for 6 years accumulates to $29,343 60 (54,000 X 73359
