Simple AnnuitySolve the following problems. Show a complete and detailed solution.What is asked? What are given? Formula to be used and a detailed solution.Write legibly and neatly.1. What is the present worth of a P1000 annuity starting at the end of the thirdyear and continuing to the end of the fourth year, if the annual interest rate is15%?2. Find the annual payment to extinguish a debt P15,000 payable for 6 years at12% interest annually.3. A factory operator bought a diesel generator set for P 20,000.00 and agreed topay the dealer uniform sum at the end of each year for 5 years at 8.5% interestcompounded annually, that the final payment will cancel the debt for principaland interest. What is the annual payment?4. A man paid 10% down payment of P200,000 for a house and lot and agreed topay the 90% balance on monthly installment for 60 months at an interest rate of10% compounded monthly. Compute the amount of the monthly payment.5. What is the accumulated amount of five-year annuity paying P 10,000 at the endof each year, with interest al 6.5% compounded annually?

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Answered: 1. What is the present worth of a P1000…

1. What is the present worth of a P1000 annuity starting at the end of the third year and continuing to the end of the fourth year, if the annual interest rate is 15%?

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

ChapterM: Time Value Of Money Module

Section: Chapter Questions

Problem 7P: Value of an Annuity Using the appropriate tables, solve each of the following. Required: 1....

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Question

Simple Annuity
Solve the following problems. Show a complete and detailed solution.
What is asked? What are given? Formula to be used and a detailed solution.
Write legibly and neatly.
1. What is the present worth of a P1000 annuity starting at the end of the third
year and continuing to the end of the fourth year, if the annual interest rate is
15%?
2. Find the annual payment to extinguish a debt P15,000 payable for 6 years at
12% interest annually.
3. A factory operator bought a diesel generator set for P 20,000.00 and agreed to
pay the dealer uniform sum at the end of each year for 5 years at 8.5% interest
compounded annually, that the final payment will cancel the debt for principal
and interest. What is the annual payment?
4. A man paid 10% down payment of P200,000 for a house and lot and agreed to
pay the 90% balance on monthly installment for 60 months at an interest rate of
10% compounded monthly. Compute the amount of the monthly payment.
5. What is the accumulated amount of five-year annuity paying P 10,000 at the end
of each year, with interest al 6.5% compounded annually?

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