NOTE: please answer 2-5. Don’t use excel. Thank you. (Draw the cash flow) ANNUITY(Draw the cash flow diagram for each problem)2. If P500.00 is deposited in an account at the beginning of each year for 6 years at an annualinterest rate of 7%, how much can be withdrawn after 6 years?3. A fund is to provide an annual scholarship at P4,000.00 for the first 5 years; P6,000.00 forthe next 5 years and P9,000.00 thereafter. The fund will be established 1 year before thefirst scholarship is awarded. If the fund earns 12% interest, what sum must be deposited?4. A man paid 10% as down payment of P200,000.00 for a house and lot and agreed to paythe balance on monthly instalments for 5 years at an interest rate of 15% compoundedmonthly. What was the monthly instalment in pesos?5. An investor deposits P10,000.00 at the end of each year in an account which gives anominal annual interest of 5% compounded continuously. How much sum will heaccumulate in 10 years?

As per the honor code, We are allowed to answer the first question only, since the exact one wasn’t…

Answered: 2. If P500.00 is deposited in an…

2. If P500.00 is deposited in an account at the beginning of each year for 6 years at an annual interest rate of 7%, how much can be withdrawn after 6 years?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

NOTE: please answer 2-5. Don’t use excel. Thank you. (Draw the cash flow)

ANNUITY
(Draw the cash flow diagram for each problem)
2. If P500.00 is deposited in an account at the beginning of each year for 6 years at an annual
interest rate of 7%, how much can be withdrawn after 6 years?
3. A fund is to provide an annual scholarship at P4,000.00 for the first 5 years; P6,000.00 for
the next 5 years and P9,000.00 thereafter. The fund will be established 1 year before the
first scholarship is awarded. If the fund earns 12% interest, what sum must be deposited?
4. A man paid 10% as down payment of P200,000.00 for a house and lot and agreed to pay
the balance on monthly instalments for 5 years at an interest rate of 15% compounded
monthly. What was the monthly instalment in pesos?
5. An investor deposits P10,000.00 at the end of each year in an account which gives a
nominal annual interest of 5% compounded continuously. How much sum will he
accumulate in 10 years?

Definition Definition Net amount of cash that an entity receives and expends over the course of a given period. For a business to continue operating, positive cash flows are required, and they are also necessary to produce value for investors. Investors in particular prefer to see growing cash flows even after capital expenditures have been paid for (which is known as free cash flow).

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