On the day his daughter was born, Engineer Ang deposited to a trust company a sufficient amount of money so that her daughter could receive eight annual payments of 50,000 pesos each for her college and masters degree tuition fees, starting with her 18TH birthday. Interest at the rate of 8% per annum was to be paid on all amounts on deposit. There was also a provision that the daughter could elect to withdraw no annual payments and receive a single lump amount on her 25th birthday. The daughter chose this option. a. How much did the daughter receive as the single payment? b. How much did the father deposit?
On the day his daughter was born, Engineer Ang deposited to a trust company a sufficient amount of money so that her daughter could receive eight annual payments of 50,000 pesos each for her college and masters degree tuition fees, starting with her 18TH birthday. Interest at the rate of 8% per annum was to be paid on all amounts on deposit. There was also a provision that the daughter could elect to withdraw no annual payments and receive a single lump amount on her 25th birthday. The daughter chose this option. a. How much did the daughter receive as the single payment? b. How much did the father deposit?
Chapter6: Deductions And Losses: In General
Section: Chapter Questions
Problem 25DQ
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Transcribed Image Text:5. On the day his daughter was born, Engineer Ang deposited to a trust company a sufficient amount of
money so that her daughter could receive eight annual payments of 50,000 pesos each for her college and
masters degree tuition fees, starting with her 18TH birthday. Interest at the rate of 8% per annum was to
be paid on all amounts on deposit. There was also a provision that the daughter could elect to withdraw
no annual payments and receive a single lump amount on her 25th birthday. The daughter chose this
option.
a. How much did the daughter receive as the single payment?
b. How much did the father deposit?
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