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On January 1, 2020, an entity adopted a plan to accumulate funds for a new building to be erected beginning January 1, 2024 at an estimated cost of P20,000,000. The entity intends to make four equal annual deposits in a fund beginning December 31, 2020 that will earn interest at 12% compounded annually. The future value of an ordinary annuity of 1 at 12% for 4 periods is 4.78, and the future value of an annuity of 1 in advance at 12% for 4 periods is 5.35. What is the annual deposit to the fund?   a. 5,000,000 b. 4,184,100 c. 3,738,318 d. 3,149,606

On January 1, 2020, an entity adopted a plan to accumulate funds for a new building to be erected beginning January 1, 2024 at an estimated cost of P20,000,000. The entity intends to make four equal annual deposits in a fund beginning December 31, 2020 that will earn interest at 12% compounded annually. The future value of an ordinary annuity of 1 at 12% for 4 periods is 4.78, and the future value of an annuity of 1 in advance at 12% for 4 periods is 5.35. What is the annual deposit to the fund?   a. 5,000,000 b. 4,184,100 c. 3,738,318 d. 3,149,606

Intermediate Accounting: Reporting And Analysis
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 10E: Amount of an Annuity John Goodheart wishes to provide for 6 annual withdrawals of 3,000 each...
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On January 1, 2020, an entity adopted a plan to accumulate funds for a new building to be erected beginning January 1, 2024 at an estimated cost of P20,000,000. The entity intends to make four equal annual deposits in a fund beginning December 31, 2020 that will earn interest at 12% compounded annually. The future value of an ordinary annuity of 1 at 12% for 4 periods is 4.78, and the future value of an annuity of 1 in advance at 12% for 4 periods is 5.35.

What is the annual deposit to the fund?
 
a. 5,000,000
b. 4,184,100
c. 3,738,318
d. 3,149,606
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