The following installments were made: P1,213 as down payment, P2,009 at the end of one year, P2,609 at the end of two years, P3,070 at the end of three years, and P4,213 at the end of four years. Determine the present value of the installment payments if money is worth 11.39% compounded annually.

The following installments were made: P1,213 as down payment, P2,009 at the end of one year, P2,609 at the end of two years, P3,070 at the end of three years, and P4,213 at the end of four years. Determine the present value of the installment payments if money is worth 11.39% compounded annually.

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 25E

See similar textbooks

Related questions

Q: What equal annual payment series is requiredto repay the following present amounts?(a) $14,000 in…

A: Hello. Since your question has multiple sub-parts, we will solve first three sub-parts for you. If…

Q: If the single payment present worth factor for 10 years is 0.30656. Determine the interest rate…

A: The present factor is the present value of $1 that has to be received/paid in the future.

Q: What is the realized balance from a eriodic payment of 100,000 dinars to paid at the end of every 6…

A: We need to use future value of ordinary annuity formula to solve this problem Future value…

Q: What is the present worth of the followingseries of payments?(a) $1,500 at the end of each year for…

A: A series of recurring fixed payments over a particular period of time is called as annuity. To…

Q: A debt can be repaid by payments of $3125.00 today, $2770.00 in two and half years and $4600.00 in…

A: To Find: Single Payment to settle debt four years from now

Q: Determine the present value of an Annuity Php 1,000.00 for 25 quarterly installment that will start…

A: The present value of the annuity is the current worth of a cash flow series at a certain rate of…

Q: 1000 dollars is deposited into an account at the beginning of the year and the value at the end of…

A: Rate of return is the return earned on an investment. It is always expressed in percentages. Rate of…

Q: What is the accumulated amount of five-year annuity paying P6,000 at the end of each year, with…

A: The worth of a present asset in the future based on a projected growth rate is referred to as future…

Q: The future value of $7,000 deposited today and compounded semiannually at an 9% annual interest rate…

A: The present value method is used to evaluate the different levels of investment projects. With the…

Q: Find the Future value of installment payments of P5,000 now, P8,000 at the end of the 1 year , 3,000…

A: Hi There, Thanks for posting the questions. As per Q&A guidelines, the solution for the first…

Q: Assume you borrow $ 60,000 at 12% per year interest and you agree to repay the loan at 11 equal…

A: Loan is an agreement between lender and borrower where lender gives lump-sum money to borrower in…

Q: A sum of 45000 invested will provide payments of 500 each at the end of every 2 months for 7 years…

A: Compound interest is interest on interest. In case of compound interest…

Q: A payment of $3,000 was made into an account at the end of every 3 months for 12 years. a. If the…

A: given, A= $3000 n = 6 years r=4% m= 4 ( quarterly compounding)

Q: A loan of P12, 500 is to be repaid with equal quarterly payments for one year with an interest of 6%…

A: Amortization table is a schedule which shows periodic lease or loan payments. The periodic payment…

Q: A man agrees to make equal payments at the beginning of each 3 months for 10 years to discharge a…

A: Quarterly rate of return (r) = 0.02 (i.e. 0.08 / 2) Principal debt (P0) = P8,000.00 Quarterly period…

Q: A loan of £ 2,120,000 is repayable by equal quarterly payments for 15 years. The effective rate of…

A: Loan Amount = 2120000 Years = 15 Interest rate(r) = 6% p.a = 6/4 = 1.50 % per quarter Terms(n) =…

Q: A loan $30.000 is to be amortized by equal payments at the end of each year for five years. The…

A: Interest payment for the 3rd year = $1080 ($30000-$6000-$6000)*6% = $1080

Q: Find the present worth of a series of equal quarterly payments of P 750.00 for 18 years with the…

A: Time value of money means that a sum of money at present is worth more than the same sum of money in…

Q: A debt of $5000 with interest 5% compounded 6-monthly is amortized by equal annual semi payments…

A: Present value annuity @ 2.5% for 6 periods = 5.50813

Q: A MAN PAYS HIS DEBT IN THE FOLLOWING MANNER: P1,000 AFTER 1 YEAR, P900 AFTER 2 YEARS, P800 AFTER 3…

A: Payment after year 1 = P 1000 Payment after year 2 = P 900 Payment after year 3 = P 800 Payment…

Q: Ahlam borrows AED 3,000,000 to be repaid over 6 years at 8 percent. What is the repayment of…

A: An annual mortgage payment is an annual payment that is to be paid for a specific period of time to…

Q: A debt of 4,400 with interest at 2.5% payable semi annually will be discharged by payment of 600 at…

A: Given information: Debt : 4,400 Interest rate : 2.5% Payments : 600

Q: A loan of 10.000 TL is repaid in equal annual installments at 10% effective interest rate per year.…

A: Given: Loan amount= 10000 TL Annual effective rate =10% Interest amount in third payment = 868.24…

Q: An annuity with a cash value of $14,000 earns 5% compounded semi-annually. End-of-period semi-annual…

A: Cash Value = $14,000 Interest Rate = 5% compounded semi annual

Q: How much in each of the quarterly installments if rate of interest 10% compounded bi-monthly?

A: A stream of equal cash flows paid or received periodically is termed as annuity. Annuity is either…

Q: A debt of P10,000 with 10 % interest compounded semi-annually is to be amortized by semi-annual…

A: Debt amount (PV) = P 10,000 Interest rate = 10% Semi annual interest rate (r) = 10%/2 = 5% Period =…

Q: Two payments of $18,000 and $2,200 are due in 1 year and 2 years, respectively. Calculate the two…

A: Compounding refers to the power of increasing the interest on the total investment . It actually…

Q: A debt of $6,000 is to be repaid by payments of $2,000 in two years, and two equal payments in three…

A: Discounting is a technique which is used to compute the PV of amount received in future by using…

Q: Find the present worth of a series of equal quarterly payments of P 750.00 for 16 years with the…

A: Amount of each quarterly payment=750 No. of years=16 Interest rates: For the first 5 years=1%…

Q: A perpetuity pays $9600 per half-year, as follows: • in odd-numbered half-year, a payment of $9600…

A: Perpetuity is a security that pays for a limitless measure of time. In money, interminability is a…

Q: Determine the present value of 15 equal quarterly payments of P1,200 where the first payment starts…

A: Solution Concept To get the present value of the future values , we need to discount the future…

Q: eries of equal semi-annual payments of $1,000 for 3 years is equivalent to what present amount at an…

A: The given problem can be solved using PV function in excel. PV function computes present amount for…

Q: A loan of £50, 000 is repayable by equal payments at the end of each of the next 5 years. Interest…

A: A sum of money payable as one of the numerous equal payments over a certain period of time is…

Q: If money is worth 12% compounded quarterly, determine the single payment at the end of the fourth…

A: The question is based on the annuity valuation. The outstanding value of every loan equals the…

Q: What equal annual payment series is required to repay the following present amounts? Working need…

Q: What is the present worth of the followingseries of payments?(a) $5,000 at the end of each six-month…

A: Periodic Payment = 5000 Semi Annual Compounding, Hence: Time Period = 12 years * 2 = 24 semi annual…

Q: If the interest rate is 13% compunded semi-annually made on the account, and the obligations are…

A: Given Information: Interest rate - 13% compounded semi-annually Deposit - P13,521 Withdrawal -…

Q: A series of equal semi-annual payments of $1,000 for 3 years is equivalent to what present amount at…

A: Given: Interest rate = 12% Semi-annual payments = $1000 Number of years = 3 Number of payments = 3*2…

Q: A perpetuity pays $9600 per half-year, as follows: ㆍin odd-numbered half-year, a payment of $9600…

A: A perpetuity is a security that pays for a limitless measure of time. In money, interminability is…

Q: A series of year end payments extending over eight years are as follows: P20,000 for the first year,…

A: The equivalent annual payment of the financial instrument is determined by dividing the present…

Q: A debt of $5600 is repaid in equal monthly instalments over three years. Interest is 7.3% compounded…

A: Installment is the amount of equal periodic payments a borrower has to make to its lender in order…

Q: A series of equal semi-annual payments of $1,000 for 3 years is equivalent to what present amount at…

A: The given problem can be solved using PV function in excel. PV function computes present amount for…

Q: A loan of P8,000 will be amortized by payments at the end of each quarter for 8 years and 9 months.…

A: To solve this problem we will have to find the periodic quarterly payment and then make a loan…

Q: A P35,000 debt is to be paid off in eight equal yearly payments, each combining an amortization…

A: Effective annual interest rate(EAR) refers to the actual interest rate which is received on deposits…

Q: An annual payment of P14 000 is made with interest rate of 10% compounded quarterly for 16 years.…

A: The present worth concept determines the value of future cash flows. The future cash flows can be in…

Q: The annual amount of a series of payments to be made at the end of the next twelve years is P500.…

A: Answered:

Question

The following installments were made: P1,213 as
down payment, P2,009 at the end of one year,
P2,609 at the end of two years, P3,070 at the end of
three years, and P4,213 at the end of four years.
Determine the present value of the installment
payments if money is worth 11.39% compounded
annually.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps with 2 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

Lime Co. incurs a $4,000 note with equal principal installment payments due for the next eight years. What is the amount of the current portion of the noncurrent note payable due in the second year? A. $800 B. $1,000 C. $500 D. nothing, since this is a noncurrent note payable
If Bergen Air Systems takes out a $100,000 loan, with eight equal principal payments due over the next eight years, how much will be accounted for as a current portion of a noncurrent note payable each year?
Next Level Potter wishes to deposit a sum that at 12% interest, compounded semiannually, will permit 2 withdrawals: 40,000 at the end of 4 years and 50,000 at the end of 10 years. Analyze the problem to determine the required deposit, stating the procedure to follow and the tables to use in developing the solution.
Cash Flow Amounts R. Lee Rouse borrows 10,000 that is to be repaid in 24 equal monthly installments payable at the end of each subsequent month with interest at the rate of 1% per month. Required: Using the appropriate table, calculate the equal installments.
A loan of $3137 borrowed today is to be repaid in three equal installments due in one-and-a-half years, three-and-a-half years, and five-and-a-half years, respectively. What is the size of the equal installments if money is worth 9.2% compounded quarterly?
If the interest rate is 13% compunded semi-annually made on the account, and the obligations are given below: Deposit of P13,521 at the end of 3 and a half years. Withdrawal of P20,812 at the end of 5 years. Semi-annual deposit of a perpetuity of P1,200 starting at the end of 6 and a half years. Determine the following: a.) Present value of all the obligations made on the account. b.) Additional amount of withdrawal at the end of 5 years to balance the cash flows. NOTE: DO NOT USE EXCEL
A loan of $4282 borrowed today is to be repaid in three equal installments due in one year, three years, and five-and-a-half years, respectively. What is the size of the equal installments if money is worth 6.8% compounded semi-annually?
A loan of $5514 borrowed today is to be repaid in three equal installments due in one-and-a-half years, three years, and five -and-a-half years, respectively. What is the size of the equal installments if money is worth 2.3% compounded monthly?