Bha Old Main is a historic campus landmark that needs maintenance and repairs to its bell tower every 15 years. Each time themaintenance and repairs are completed, this costs $850,000. The university is seeking a donor to establish an endowment that will payfor all the Old Main bell tower repair and maintenance costs. How large of a charitable gift should the University pursue, assuming thedonor's gift is invested in a fund that earns 4% compounded annually?Click here to access the TVM Factor Table calculator.$Carry all interim calculations to 5 decimal places and then round your final answer to a whole number. The tolerance is ±$7,000.eTextbook and MediaHintConvert the recurring costs to an annual equivalent before finding the capitalized cost.Assistance Used

Present value is money needed today based on future money required based on time value of money and…

Answered: Old Main is a historic campus landmark…

SWFT Comprehensive Volume 2019

42nd Edition

ISBN:9780357233306

Author:Maloney

Publisher:Maloney

Chapter17: Corporations: Introduction And Operating Rules

Section: Chapter Questions

Problem 39P

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On December 27, 2019, Roberta purchased four tickets to a charity ball sponsored by the city of San Diego for the benefit of underprivileged children. Each ticket cost 200 and had a fair market value of 35. On the same day as the purchase, Roberta gave the tickets to the minister of her church for personal use by his family. At the time of the gift of the tickets, Roberta pledged 4,000 to the building fund of her church. The pledge was satisfied by a check dated December 31, 2019, but not mailed until January 3, 2020. a. Presuming that Roberta is a cash basis and calendar year taxpayer, how much can she deduct as a charitable contribution for 2019? b. Would the amount of the deduction be any different if Roberta was an accrual basis taxpayer? Explain.
An alumnus of West Virginia University wishes to start an endowment that will provide scholarship money of $40,000 per year beginning in year 5 and continuing indefinitely. The donor plans to give money now and for each of the next 2 years. If the size of each donation is exactly the same, the amount that must be donated each year at i = 8% per year is closest to: (a) $190,820 (b) $122,280 (c) $127,460 (d) $132,040
A donor established a new scholarship that will pay $5,000 every 6 months to a deserving Kelley student. The scholarship will be awarded for the first time in November of 2021 (12 months from today). The donor decides that the scholarship should be provided in perpetuity. The IU Foundation manages investments like this for the Business School. The Foundation anticipates earning an APR of 8% per year on the invested funds, compounded monthly. What is the amount of the donation that must be given to the IU Foundation today to fully endow this Kelley scholarship?
Beginning next year, a foundation will support an annual seminar on campusby using the interest earnings on a $100,000 gift it received this year. It is determined that 6% interest will be realized for the first 10 years, but that plans should be made to anticipate an interest rate of only 4% after that time. What amount should be added to the foundation now in order to fund the seminar at a level of $10,000 per year into infinity?
Beginning next year, a foundation will supportan annual event on campus with the earnings of a$420,000 gift it received this year. It is felt that 8.4%interest will be realized for the first 12 years, but thatplans should be made to anticipate an interest rate of6% after that time. What amount should be added tothe foundation now to fund the event at the $45,000level into infinity?
Sarah Bishop, having become a very successful engineer, wishes to start an endowment at UTM that will provide scholarships of $10,000 per year to four engineering students beginning in Year 6 and continuing indefinitely. Determine the amount Sarah must donate now if the university earns 10% per year on endowment funds.
Arlington Town uses an Internal Service Fund to account for its motor poolactivities. You have the following information:Automobiles: The Motor Pool uses two 6-passenger vans, each costing $90,000and each estimated to have a 5-year life when they were acquired in 2020.Driver salaries: The Motor Pool has a driver-administrator, who earns $90,000a year, and a driver, who earns $70,000.The town uses a rate of 33 percent (to cover benefits, including pensions)for planning purposes.Insurance: In 2020, the town purchased a 3-year automobile accident policyat a cost of $12,000.Fuel and maintenance costs: Based on experience, the driver-administratorestimates that total fuel and maintenance costs for the year will be $16,000.Billing units: To simplify its record keeping, the Motor Pool charges a fixed priceper trip. Arlington’s budget office estimates it will provide 1,600 trips to thetown’s departments in 2021.Arlington Town had the following transactions and events during January 2021:1.…
A donor established a scholarship that will pay $15,000 per year to a Kelley student. The scholarship will be awarded for the first time in September of 2023 (i.e., the first payment occurs three years from now). The donor decides that the scholarship should be provided in perpetuity. The IU Foundation manages investments like this for the Business School. The Foundation anticipates earning an APR of 5.6% per year on the invested funds. What is the amount of the donation that must be given to the IU Foundation today to endow this Kelley scholarship?
Maintenance money for a new building at a college is being solicited frompotential alumni donors. You would like to make a donation to cover all future expected maintenance costs for the building. These maintenance costs are expected to be $40,000 each year for the first five years, $50,000 for each of years 6 through 10, and $60,000 each year after that. (The building has an indefinite service life.)(a) If the money is placed in an account that will pay 13% interest compounded annually, how large should the gift be?(b) What is the equivalent annual maintenance cost over the infinite servicelife?
The University is given a gift of $500000 for the construction of a School of Management building. The University invests the gift into an account for future use. The University receives 8.00% on the money for 7 years then the rate drops to 6.40%. If the building is constructed 23 years after the gift was received, how much is in the fund at that time? S Do not use dollar signs or commas in your answer. Include two decimals. in your answer.
A firm wants to sponsor a new engineering lab at a local university. This requires $4M to construct the lab, $1.5M to equip it, and $750,000 every 6 years for new equipment. What is the required endowment if the university will earn 8% interest on the funds? Answer: $6,777,957
A charity will be donated by a wealthy man to provide annual scholarships to deserving students. The charity will grant $120,000 each year for the first 5 years, $30,000 per quarter for the next 5 years and $10,000 each month thereafter . The scholarship will start one year after the fund is established. What is the amount of the donation if i = 12% compounded annually?

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