3.50 McCarthy Construction is trying to bring the company - funded portion of its employee retirement fund into compliance with HB-301. The company has already deposited $500,000 in each of the last 5 years. If the company increases its deposits beginning in year 6 by 15% per year each year through year 20, how much will be in the fund immediately after the last deposit, provided the fund grows at a rate of 12% per year? Solve using (a) tabulated factors, and (b) a spreadsheet.

3.50 McCarthy Construction is trying to bring the company - funded portion of its employee retirement fund into compliance with HB-301. The company has already deposited $500,000 in each of the last 5 years. If the company increases its deposits beginning in year 6 by 15% per year each year through year 20, how much will be in the fund immediately after the last deposit, provided the fund grows at a rate of 12% per year? Solve using (a) tabulated factors, and (b) a spreadsheet.

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter4: Time Value Of Money

Section: Chapter Questions

Problem 16PROB

See similar textbooks

Similar questions

EQUIVALENT ANNUAL ANNUITY Corcoran Consulting is deciding which of two computer systems to purchase. It can purchase state-of-the-art equipment (System A) for 20,000, which will generate cash flows of 6,000 at the end of each of the next 6 years. Alternatively, the company can spend 12,000 for equipment that can be used for 3 years and will generate cash flows of 6,000 at the end of each year (System B). If the companys WACC is 10% and both projects can be repeated indefinitely, which system should be chosen, and what is its EAA?
McCarthy Construction is trying to bring the company-funded portion of its employee retirement fund into compliance with HB-301. The company has already deposited $500,000 in each of the last 5 years. Beginning in year 6, McCarthy will increase its deposits by 15% per year through year 20. How much will be in the fund immediately after the last deposit, if the fund grows at a rate of 12% per year? Solve using (a) tabulated factors, and (b) a spreadsheet.
Week 3Fifteen years ago, you deposited $12,500 into an investment fund. Five years ago, you added anadditional $20,000 to that account. You earned 8%, compounded semi-annually, for the first ten years,and 6.5%, compounded annually, for the last five years.Required: c) If you wish to have $85,000 now, how much should you have invested 15 years ago?
H5. Jordan deposited $23,500 into a fund at the beginning of every quarter for 20 years. He then stopped making deposits into the fund and allowed the investment to grow for 3 more years. The fund was growing at 4.31% compounded monthly. a. What was the accumulated value of the fund at the end of year 20? Round to the nearest cent b. What was the accumulated value of the fund at the end of year 23? Round to the nearest cent c. What is the total amount of interest earned over the 23-year period? Round to the nearest cent Show proper step by step calculation
Please solve #2 and #6 A corporation creates a sinking fund in order to have $860,000 to replace some machinery in 11 years. How much should be placed in this account at the end of each quarterif the annual interest rate is 6.5% compounded quarterly? (Round your answers to the nearest cent.)$ 2. How much interest would they earn over the life of the account?$ Determine the value of the fund after 2, 4, and 6 years. 2 years $ 4 years $ 6 years $ 6. How much interest was earned during the third quarter of the 4th year?$
a) An individual wishes to accumulate $1,700,000 in 20 years. If he wants to deposit a certain amount of fund annually in the first 10 years and do nothing in the following 10 years, what size deposit is required to meet the stated objective? Assume the annual compound interest rate is 4%. b) Solve the following, using interest rate at 7% compounded annually: i) What is the amount that will be accumulated in a sinking fund at the end of the 15th year if $200 is deposited in the fund at the beginning of each of the 15 years? ii) What uniform annual payment for 30 years is equivalent to spending $10,000 immediately, $11,000 at the end of 10 years, $12,000 at the end of 20 years, and $2,000 a year for 30 years?
Kau.1 Sarasota Corporation wants to withdraw $123,730 (including principal) from an investment fund at the end of each year for 9 years. What should be the required initial investment at the beginning of the first year if the fund earns 11%? (Round factor values to 5 decimal places, e.g. 1.25124 and final answer to 0 decimal places, e.g. 458,581.) Required initial investment
Week 3Fifteen years ago, you deposited $12,500 into an investment fund. Five years ago, you added anadditional $20,000 to that account. You earned 8%, compounded semi-annually, for the first ten years,and 6.5%, compounded annually, for the last five years.Required: a) What is the effective annual interest rate (EAR) you would get for your investment in the first 10 years?
9.) To add a new storage building The Fast Hauling Company will need $1,000,000 in 5 years. They plan to make quarterly payments into a sinking fund at 8.5 percent interest compounded quarterly. How much money should be deposited each quarter into the fund so that a new storage building can be added after 5 years? (answer in the whole number)
_____ 2. How much should be invested in a fund each year paying 2% compounded annually to accumulate ₽100,000 for 5 years? A. ₽19,215.84 C. ₽21,215.84 B. ₽20,215.84 D. ₽22,215.84
In order to accumulate $1,000,000 over 20 years, how much would you have to invest at the beginning of every three months into a fund earning 7.2% compounded quarterly? a $5,369.45 b $5,169.57 c $5,0128.36 d $5,262.62
A corporation creates a sinking fund in order to have $640,000 to replace some machinery in 10 years. How much should be placed in this account at the end of each quarter if the annual interest rate is 5.3% compounded quarterly? (Round your answers to the nearest cent.)$ How much interest would they earn over the life of the account?$ Determine the value of the fund after 2, 4, and 6 years. 2 years $ 4 years $ 6 years $ How much interest was earned during the second quarter of the 5th year?