# On January 1, you win $60,000,000 in the state lottery. The$60,000,000 prize will be paid in equal installments of $6,000,000 over 10 years. The payments will be made on December 31 of each year, beginning on December 31 of the current year. If the current interest rate is 6%, determine the present value of your winnings. Use the present value tables in Appendix A. BuyFindarrow_forward ### Financial Accounting 15th Edition Carl Warren + 2 others Publisher: Cengage Learning ISBN: 9781337272124 #### Solutions Chapter Section BuyFindarrow_forward ### Financial Accounting 15th Edition Carl Warren + 2 others Publisher: Cengage Learning ISBN: 9781337272124 Chapter 14, Problem 19E Textbook Problem 348 views ## On January 1, you win$60,000,000 in the state lottery. The $60,000,000 prize will be paid in equal installments of$6,000,000 over 10 years. The payments will be made on December 31 of each year, beginning on December 31 of the current year. If the current interest rate is 6%, determine the present value of your winnings. Use the present value tables in Appendix A.

To determine

Calculate the present value of winnings.

### Explanation of Solution

Present Value: The value of today’s amount expected to be paid or received in the future at a compound interest rate is called as present value.

Calculate the present value of winnings.

Present value=(Future amount×Present value of annuity of \$1

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