city has $2.5 million worth of school bonds that are due in 20 years and has established a sinking fund to retire this debt. If the fund earns interest at the rate of 7% per year compounded annually, what amount must be deposited annually in this fund?
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A city has $2.5 million worth of school bonds that are due in 20 years and has
established a sinking fund to retire this debt. If the fund earns interest at the rate of 7%
per year compounded annually, what amount must be deposited annually in this fund?
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- A utility district has issued bonds totaling $4.7 Million with a fixed annual coupon rate of 4.00% and a term of 30 years. In addition to making the annual coupon payment, the district must deposit an additional annual amount (an equal amount each year beginning one year from the date of issuance) into a sinking fund so that the principle balance of $4.7 million will be on hand when the bonds come due. The district can earn 3.50% on its invested funds. What is the combined amount of money required for each year’s coupon payment and sinking fund payment? Submit whole number with no commas and no currency signThe city of Glendale borrows $48 million by issuing municipal bonds to help build the Arizona Cardinals football stadium. It plans to set up a sinking fund that will repay the loan at the end of 10 years. Assume a 4 percent interest rate per year. What should the city place into the fund at the end of each year to have $48 million in the account to pay back their bondholders?The City of Bernard starts the year of 2020 with the following unrestricted amounts in its general fund: cash of $42,250 and investments of $82,500. In addition, it holds a small building bought on January 1, 2019, for general government purposes for $318,000 and a related long-term debt of $254,400. The building is depreciated on the straight-line method over 10 years. The annual interest rate on the debt is 10 percent. The general fund has four separate functions: general government, public safety, public works, and health and sanitation. Other information includes the following: Receipts: Property taxes $597,000 Sales taxes 107,800 Dividend income 25,000 Charges for general government services 19,400 Charges for public safety services 12,050 Charges for public works 5,700 Charges for health and sanitation services 40,800 Charges for landfill 9,200 Grant to be used for salaries for health workers (no eligibility requirements) 28,500 Issued long-term…
- A state agency issues $575 million in bonds to repair bridges in the state. The state establishes a sinking fund by depositing $4 million at the end of each quarter into the fund for 20 years to repay the bonds. The fund earns an annual interest rate of 5.8% compounded quarterly. How much money (in millions of dollars) is in the fund after 20 years? (Round your answer to two decimal places.)The city isrequired to make regular payments every 3 months into a sinking fund paying 5.4% compounded quarterly. At the end of 10 years, the bond obligation will be retired with a cost of $5,000,000. A) What should each payment be? B) How much is earned during the 10th year?The school district needs to pass a bond levy for funding to remodel existing schools and to build new schools. Expenditures for the new and remodeled buildings will begin two years after passage of the bond. If the school district receives all funding immediately after the passage of the bond and can invest the funds at a rate of 2.75% per year, how large must the bond be for the district to have $48,000,000 at the start of construction?
- The Town Debt Service Fund accumulates resources to pay its $3 million general obligation debt. The debt is payable in equal annual installments of principal over 20 years with 5% interest on the unpaid principal. Prepare journal entries to record the following transactions in the Debt Service Fund. The Town levies a special property tax amounting to $550,000 to pay debt service on its long-term general obligation debt. The tax must be accounted for in the Debt Service Fund. All the property taxes levied for debt service purposes are collected. The Town invests $250,000 in a six-month certificate of deposit. Debt service (interest of $150,000 and principal of $150,000) becomes due and payable. The debt service liabilities from 4. are paid. The certificate of deposit in 3. matures and the Town receives a total of $261,000.the Shannon Township Debt Service Fund accumulates resources to pay its $2 million general obligation debt. The debt is payable in equal annual installments of principal over 10 years with 5% interest on the unpaid principal. Prepare journal entries to record the following transactions in the Debt Service Fund. 1. The Township levies a special property tax amounting to $500,000 to pay debt service on its long-term general obligation debt. 2. All the property taxes levied for debt service purposes are collected. 3. The Township invests $150,000 in a six-month certificate of deposit. 4. Debt service (interest of $100,000 and principal of $200,000) becomes due to bondholders. 5. The certificate of deposit in c. matures and the Township receives a total of $153,000, which includes $3,000 of interest.A corporation creates a sinking fund in order to have $950,000 to replace some machinery in 11 years. How much should be placed in this account at the end of each week if the annual interest rate is 3% compounded weekly? (Round your answers to the nearest cent.)$ 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 fourth week of the 6th year?
- A corporation creates a sinking fund in order to have $440,000 to replace some machinery in 8 years. How much should be placed in this account at the end of each week if the annual interest rate is 3.8% compounded weekly? (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 week of the 4th year?A corporation creates a sinking fund in order to have $510,000 to replace some machinery in 12 years. How much should be placed in this account at the end of each quarter if the annual interest rate is 6.3% 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 fourth quarter of the 5th year? $A city has issued bonds to finance a new convention center. The bonds have a total face value of $3,000,000 and are payable in 8 years. A sinking fund has been opened to meet this obligation. If the interest rate on the fund is 6.7% compounded quarterly, what will be the quarterly payments? (Round your final answer to two decimal places.)
