Financial Accounting (12th Edition) (What's New in Accounting)
12th Edition
ISBN: 9780134725987
Author: C. William Thomas, Wendy M. Tietz, Walter T. Harrison Jr.
Publisher: PEARSON
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Chapter F, Problem 3QC
To determine
To identify: The present value of manufacturers’ settlement at the end of five years at 4% interest rate.
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You have received a settlement offer from an automobile manufacturer due to mechanicalproblems with your automobile. The manufacturer will pay you $20,000 in one lump sumfive years from now. You can earn 4% on your investments. The present value of the manufacturer’s settlement offer is closest toa. $20,000.b. $19,200.c. $24,330.d. $16,440.
You are hurt in a car accident and your lawyer wins a $100,000 settlement to be distributed as follows: $20,000 immediate payment $7,000 a year for ten years $30,000 after ten years. If the lawyer's fee is $10,000, what is the value of this settlement if the interest rate is 8 percent? Answer in format of 1,234.56.
An investor who recently returned from overseas decided to invest in a venture proposed by leading investment company.The investor is expected to receive ten(10) sum payment of $5000 at the end of each year for ten(10)years.However payments increased by 5% on the second(2nd),10% on the fourth (4th),15% on the sixth(6th),20% on the eighth(8th) and 25% on the tenth(10th) payment.
Calculate the sum that should be payed to him at an interest of 5%
Chapter F Solutions
Financial Accounting (12th Edition) (What's New in Accounting)
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