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 F.5Q
To determine
To identify: The present value of $3,000 at the end of seven years at 8% interest from the choices.
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1i. A sum of £100 is invested in a savings account at the end of each quarter for seven years. Interest earned is 8% per annum compounded quarterly. Compute the future value of this investment.
ii. £50 was deposited in a savings account at the end of each quarter at 7% interest per annum compounded quarterly. After n years, this investment had attained a value of £1475.55. Evaluate n.
Using the following partial table of present value of $1 at compound interest, determine the present value of $25,000 to be received four years hence, with earnings at the rate of 10% a year.
Year
6%
10%
12%
1
.943
.909
.893
2
.890
.826
.797
3
.840
.751
.712
4
.792
.683
.636
a.$22,725
b.$15,900
c.$17,075
d.$19,800
13. A businessman invested $ 1,000 and after 4 years, it becomes $ 1,608.44 invested at a certain interest compounded bi-monthly. Determine the effective rate.
Chapter F Solutions
Financial Accounting (12th Edition) (What's New in Accounting)
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Similar questions
- Assume that $1,000 is deposited today, two years from now, four years from now, six years from now, and eight years from now. At 8% interest compounded annually, determine the future value at the end of year 9. (a) $4,174(b)$7,521(c) $2,085(d) $1,895arrow_forwardFind the accumulated value of an investment of $15,000 at 5% compounded semiannually for 12 years. $20,173.33 $27,130.89 $26,937.84 $24,000.00arrow_forward1. Compute the future value (compound amount) of $4,500 invested for 10 years at 5% compounded quarterly.arrow_forward
- Compute the accumulated amounts after 5 years of P1,000 invested at the rate of 10% per year compounded 1) annually A. P1,610.51 B. P1,638.62 C. P1,648.72 D. P1,628.89 2) semi-annually A. P1,610.51 B. P1,638.62 C. P1,648.72 D. P1,628.89 3) quarterly A. P1,645.31 B. P1,638.62 C. P1,648.72 D. P1,648.61 4) monthly A. P1,645.31 B. P1,638.62 C. P1,648.72 D. P1,648.61 5) daily A. P1,645.31 B. P1,638.62 C. P1,648.72 D. P1,648.61 6) continuously A. P1,645.31 B. P1,638.62 f. P1,648.72 D. P1,648.61arrow_forward(Compound interest) To what amount will the following investments accumulate? a. $5,000 invested for 10 years at 10 percent compounded annually b. $8,000 invested for 7 years at 8 percent compounded annually c. $775 invested for 12 years at 12 percent compounded annually d. $21,000 invested for 5 years at 5 percent compounded annuallyarrow_forwardThe principal P is invested at the interest rate of r/year for t years. (Use a 365-day year.) P = $110,000, r = 4%, t = 7 1 4 , compounded monthly.Determine i, the compound interest rate.arrow_forward
- Present value formula determine the amount invested now or the present value needed desired accumulatd amount 23000 after 8 years invested in an account with 4 percent interest compounded semiannuallyarrow_forwardFind the present value of 1,000 for 20 years at a) 4% compounded annually b) 8% compounded quarterly. Find the present value of 16,800 due at the end of 30 years and 6 months at c) 4.5% compounded annually d) 12% compounded semiannually.arrow_forwardWhat is the future value of a lump sum of $18,443 invested for 15 years at 3.2 percent compounded annually? $29,581.97 $348,092.67 $29,786.22 $400,306.57arrow_forward
- 8. The company purchased equipment and agreed to make payments of $5,400 at the end of each year for the next 8 years The company will record the purchase price of the equipment at the present value of the payments The company can borrow money at 5% interest Assume annual compound Determine the present value of the payments?arrow_forwardprinciple 26,000 , 10 years, 5% , interest compound amount annually, compound amount _, compound interest _?arrow_forwardUsing the following partial table of present value of $1 at compound interest, the present value of $96,666 to be received 3 years hence with earnings at the rate of 6% a year is Year 6% 10% 12% 1 0.943 0.909 0.893 2 0.890 0.826 0.797 3 0.840 0.751 0.712 4 0.792 0.683 0.636 A..$61,479.58 b.$76,559.47 c.$66,022.88 d.$81,199.44 please give me answerarrow_forward
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