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2.0300 2.0400 2.0500 2.0600 2.0700 2.0800 2.0900 2.1000 2.1100 2.1200 3.0909 3.1216 3.1525 3.1836 3.2149 3.2464 3.2781 3.3100 3.3421 3.3744 4.1836 4.2465 4.3101 4.3746 4.4399 4.5061 4.5731 4.6410 4.7097 4.7793 5.3091 5.4163 5.5256 5.6371 5.7507 5.8666 5.9847 6.1051 6.2278 6.3528 5.4684 6.6330 6.8019 6.9753 7.1533 7.3359 7.5233 7.7156 7.9129 8.1152 7.6625 7.8983 8.1420 8.3938 8.6540 8.9228 9.2004 9.4872 9.7833 10.0890 3.8923 9.2142 9.5491 9.8975 10.2598 10.6366 11.0285 11.4359 11.8594 12.2997 0.1591 10.5828 11.0265 11.4913 11.9780 12.4876 13.0210 13.5795 14.1640 14.7757 1.4639 12.0061 12.5779 13.1808 13.8164 14.4866 15.1929 15.9374 16.7220 17.5487 20070 1240 ca 1420CO 14071C 1C C Ar 105 2 10 CC 4 20 CEAC

2.0300 2.0400 2.0500 2.0600 2.0700 2.0800 2.0900 2.1000 2.1100 2.1200 3.0909 3.1216 3.1525 3.1836 3.2149 3.2464 3.2781 3.3100 3.3421 3.3744 4.1836 4.2465 4.3101 4.3746 4.4399 4.5061 4.5731 4.6410 4.7097 4.7793 5.3091 5.4163 5.5256 5.6371 5.7507 5.8666 5.9847 6.1051 6.2278 6.3528 5.4684 6.6330 6.8019 6.9753 7.1533 7.3359 7.5233 7.7156 7.9129 8.1152 7.6625 7.8983 8.1420 8.3938 8.6540 8.9228 9.2004 9.4872 9.7833 10.0890 3.8923 9.2142 9.5491 9.8975 10.2598 10.6366 11.0285 11.4359 11.8594 12.2997 0.1591 10.5828 11.0265 11.4913 11.9780 12.4876 13.0210 13.5795 14.1640 14.7757 1.4639 12.0061 12.5779 13.1808 13.8164 14.4866 15.1929 15.9374 16.7220 17.5487 20070 1240 ca 1420CO 14071C 1C C Ar 105 2 10 CC 4 20 CEAC

FINANCIAL ACCOUNTING
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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**Ordinary Annuity Table for Compound Sum of an Annuity of $1** **Introduction:** In financial mathematics, understanding compound interest and annuity is essential for various financial calculations. The table below demonstrates the compound sum of an ordinary annuity of $1 for different interest rates and periods. **Table Explanation:** The table provided displays the compounded sums for an ordinary annuity of $1 over various periods and interest rates. Each column corresponds to a specific interest rate ranging from 2% to 13%, and each row corresponds to the duration from 1 to 50 periods. **Columns:** - The table includes interest rates of 2%, 3%, 4%, 5%, 6%, 7%, 8%, 9%, 10%, 11%, 12%, and 13%. Each column represents the compound sum for one of these interest rates. **Rows:** - Each row represents a different period, starting from 1 and going up to 50. **Reading the Table:** 1. To find the compound sum for a specific interest rate and period, locate the intersection of the desired period row and interest rate column. 2. For example, for a 5% interest rate over a period of 10 periods, the compound sum is found by locating the 10th row and 5th column, which yields 12.5779. **Example Calculations:** - For a 3% interest rate over 20 periods, the compound sum is 26.8704. - For a 7% interest rate over 15 periods, the compound sum is 25.1290. - For a 10% interest rate over 25 periods, the compound sum is 98.3471. **Note:** This table is a sampling representation. For more comprehensive tables, including those with interest rates from 0.5% to 15%, refer to the "Business Math Handbook." **Important Points:** - The values show how savings will grow over time when periodically added to at a steady interest rate. - This table can be useful for financial planning, retirement savings, and understanding long-term investment growth. **Conclusion:** The ordinary annuity table is a crucial tool for calculating the growth of annuities based on different interest rates and periods. By understanding and utilizing these tables, students, financial planners, and individuals can make more informed financial decisions.
Transcribed Image Text:**Ordinary Annuity Table for Compound Sum of an Annuity of $1** **Introduction:** In financial mathematics, understanding compound interest and annuity is essential for various financial calculations. The table below demonstrates the compound sum of an ordinary annuity of $1 for different interest rates and periods. **Table Explanation:** The table provided displays the compounded sums for an ordinary annuity of $1 over various periods and interest rates. Each column corresponds to a specific interest rate ranging from 2% to 13%, and each row corresponds to the duration from 1 to 50 periods. **Columns:** - The table includes interest rates of 2%, 3%, 4%, 5%, 6%, 7%, 8%, 9%, 10%, 11%, 12%, and 13%. Each column represents the compound sum for one of these interest rates. **Rows:** - Each row represents a different period, starting from 1 and going up to 50. **Reading the Table:** 1. To find the compound sum for a specific interest rate and period, locate the intersection of the desired period row and interest rate column. 2. For example, for a 5% interest rate over a period of 10 periods, the compound sum is found by locating the 10th row and 5th column, which yields 12.5779. **Example Calculations:** - For a 3% interest rate over 20 periods, the compound sum is 26.8704. - For a 7% interest rate over 15 periods, the compound sum is 25.1290. - For a 10% interest rate over 25 periods, the compound sum is 98.3471. **Note:** This table is a sampling representation. For more comprehensive tables, including those with interest rates from 0.5% to 15%, refer to the "Business Math Handbook." **Important Points:** - The values show how savings will grow over time when periodically added to at a steady interest rate. - This table can be useful for financial planning, retirement savings, and understanding long-term investment growth. **Conclusion:** The ordinary annuity table is a crucial tool for calculating the growth of annuities based on different interest rates and periods. By understanding and utilizing these tables, students, financial planners, and individuals can make more informed financial decisions.
### Investment Growth Estimation **Description:** Financial analysts recommend investing 15% to 20% of your annual income in your retirement fund to reach a replacement rate of 70% of your income by age 65. This recommendation increases to almost 30% if you start investing at 45 years old. **Case Study:** Mallori Rouse, aged 29, has started investing $4,600 at the end of each year in her retirement account. The account earns an 8% interest rate compounded annually. **Question:** How much will her account be worth in the future? Use the following periods for estimation and the provided [Table 13.1](#) (please note the link is for instructional purposes and does not lead to a table). - **Future value after 20 years** - **Future value after 30 years** - **Future value after 40 years** - **Future value after 50 years** **Instructions:** Do not round intermediate calculations. Round your answers to the nearest whole dollar amount. #### The following table is used to fill in the computed values: | Period | Future Value | |----------------------------|--------------| | Future value after 20 years| | | Future value after 30 years| | | Future value after 40 years| | | Future value after 50 years| | By determining these future values, one can better understand the long-term benefits of early and consistent investment in a retirement account.
Transcribed Image Text:### Investment Growth Estimation **Description:** Financial analysts recommend investing 15% to 20% of your annual income in your retirement fund to reach a replacement rate of 70% of your income by age 65. This recommendation increases to almost 30% if you start investing at 45 years old. **Case Study:** Mallori Rouse, aged 29, has started investing $4,600 at the end of each year in her retirement account. The account earns an 8% interest rate compounded annually. **Question:** How much will her account be worth in the future? Use the following periods for estimation and the provided [Table 13.1](#) (please note the link is for instructional purposes and does not lead to a table). - **Future value after 20 years** - **Future value after 30 years** - **Future value after 40 years** - **Future value after 50 years** **Instructions:** Do not round intermediate calculations. Round your answers to the nearest whole dollar amount. #### The following table is used to fill in the computed values: | Period | Future Value | |----------------------------|--------------| | Future value after 20 years| | | Future value after 30 years| | | Future value after 40 years| | | Future value after 50 years| | By determining these future values, one can better understand the long-term benefits of early and consistent investment in a retirement account.
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