(From section 6.1) SouthWestern airlines sets up a sinking fund so that they will have $75,500 to pay for a replacement piece of equipment in 15 years when the current equipment will be sold for scrap. If they make deposits into the account at the beginning of every 3 months for 15 years, and the investment account pays 4.4% interest compounded every 3 months, what will the quarterly deposit be to reach their goal? (a) Which formula will you use? Circle one. Annuity Payout-Annuity (b) What are the following variables that we will need for the formula? PMT = n = t = r = A or Po = (c) Write the formula you will use with the numbers plugged in below.

(From section 6.1) SouthWestern airlines sets up a sinking fund so that they will have $75,500 to pay for a replacement piece of equipment in 15 years when the current equipment will be sold for scrap. If they make deposits into the account at the beginning of every 3 months for 15 years, and the investment account pays 4.4% interest compounded every 3 months, what will the quarterly deposit be to reach their goal? (a) Which formula will you use? Circle one. Annuity Payout-Annuity (b) What are the following variables that we will need for the formula? PMT = n = t = r = A or Po = (c) Write the formula you will use with the numbers plugged in below.

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

ChapterA: Appendix - Time Value Of Cash Flows: Compound Interest Concepts And Applications

Section: Chapter Questions

Problem 23E

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