A business has been involved in a lawsuit that they have lost in court. The judge has ordered money to be put in escrow during the appeal. This is to guarantee that the plaintiff will be able to receive the judgement, if the company loses its appeal. The plaintiff has been awarded quarterly payments in the amount of $14,000.00 for 20 years with the first payment to be made as soon as the appeal is decided. It was agreed by the judge and both parties that an estimated time for the the appeals process will last 7 years. If money is worth 4%, compounded quarterly. How much did the judge order the company to put into the annuity today at the start of the appeal process?

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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A business has been involved in a lawsuit that they have lost in court. The judge has ordered money to be put in escrow during the appeal. This is to guarantee that the plaintiff will be able to receive the judgement, if the company loses its appeal. The plaintiff has been awarded quarterly payments in the amount of $14,000.00 for 20 years with the first payment to be made as soon as the appeal is decided. It was agreed by the judge and both parties that an estimated time for the the appeals process will last 7 years. If money is worth 4%, compounded quarterly. How much did the judge order the company to put into the annuity today at the start of the appeal process?

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