A payment of $3,530 is due in 45 days and another payment of $4,790 is due in 280 days. Calculate the single equivalent payment to be made in 80 days to settle the two payments if money earns 6.05% p.a. (Hint: use 80 days from now as the focal date.) $

A payment of $3,530 is due in 45 days and another payment of $4,790 is due in 280 days. Calculate the single equivalent payment to be made in 80 days to settle the two payments if money earns 6.05% p.a. (Hint: use 80 days from now as the focal date.) $

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Firm ZLC will be receiving payments of $10,000 per month for consulting services, with first payment…

A: Future value of annuity The future value of annuity refers to the total value of the investment at…

Q: Scheduled payments of $732 due one year ago and $1476 due in six years are to be replaced by two…

A: Two scheduled payments are to be replaced by two equal replacement payments. Quantum and timing of…

Q: A contract calls for a payment of P 1,200 at the beginning of each month for 12 months. At what rate…

A: Compound interest is interest calculated on the deposit or loan's original principal with any…

Q: Payments of $3,700, due 70 days ago, and $4,200, due in 60 days, are to be replaced by payments of…

A: Time value of money states that the money with us today has more value than the same amount of money…

Q: Two payments of $16,000 and $2,500 are due in 1 year and 2 years, respectively. Calculate the two…

A: Answer Interest Yearly 10.5% Compound Quarterly Quarterly Interest Rate 10.5%/4 2.63%…

Q: A 161,781 loan is being repaid with monthly payments for 8 years. The first payment is 800 and is…

A: A loan is a contract between a lender and a borrower where the lender forwards a fixed amount to the…

Q: A payment of $1,930 is due in 55 days and another payment of $3,600 is due in 300 days. Calculate…

A: Given: A payment of $1930 is due in 55 days and another payment of $3600 is due in 300 days. So,…

Q: What equal payments in 2 years and 4 years would replace payments of $32, 500 and $72, 500 in 7…

A: The concept of time value of money will be used here. As per this concept money has the power to…

Q: Find the equivalent replacement payments for the following scheduled payments. Original Scheduled…

A: A financial concept known as the time value of money (TVM) contends that the same amount of money…

Q: Find the equivalent replacement payments for the following scheduled payments. Original Scheduled…

A: The concept of the time value of money states that between the same amount available now and…

Q: A payment of $1,930 is due in 55 days and another payment of $3,600 is due in 300 days. Calculate…

A: Present value of future amount With periodic interest rate (r), period (n) and future value (FV),…

Q: Scheduled payments of $379, $1336, and $825 are due in one year, four-and-a-half years, and…

A: The concept of time value of money will be used here. As per the concept of time value of money the…

Q: A payment of $2798.6 due 9 months ago and payment of $2925.6 due in 4 months are to be repaid by a…

A: In the context of the given question, we are required to compute the size of a single equivalent…

Q: cheduled payments of $1049, $1055, and $1459 are due in one year, three-and-a-half years, and five…

A: First, we need to determine the PV of each payment using the formula below:Then we need to take the…

Q: Scheduled payments of $825, $352, and $ 1045 are due in one year, four and a half years, and five…

A: The term equivalent payment considers the original amount along with the interest to date. The…

Q: The equivalent Tingle replacement payment is $ (Round the final answer to the nearest cent as…

A: First, we need to determine the PV of each payment using the formula below:Then we need to take the…

Q: wo payments of $16,000 and $6,800 are due in 1 year and 2 years, respec alculate the two equal…

A: Present value of money would give the required money today that is equivalent to future payment to…

Q: Payment of $942 due 1 months ago and $439 due today are to be repaid by a payment of $400 one month…

A: Present value is the estimation of the current value of future cash value which is likely to be…

Q: cheduled payments of $503, $1303, and $975 are due in one-and-a-half years, three-and-a-half years,…

A: To calculate the equivalent single replacement payment, we need to find the present value of each of…

Concept explainers

Risk and return

Before understanding the concept of Risk and Return in Financial Management, understanding the two-concept Risk and return individually is necessary.

Capital Asset Pricing Model

Capital asset pricing model, also known as CAPM, shows the relationship between the expected return of the investment and the market at risk. This concept is basically used particularly in the case of stocks or shares. It is also used across finance for pricing assets that have higher risk identity and for evaluating the expected returns for the assets given the risk of those assets and also the cost of capital.

Question

A payment of $3,530 is due in 45 days and another payment of $4,790 is due in 280 days.
Calculate the single equivalent payment to be made in 80 days to settle the two payments if
money earns 6.05% p.a. (Hint: use 80 days from now as the focal date.) $

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Follow-up Questions

Read through expert solutions to related follow-up questions below.

Follow-up Question

A payment of $1,930 is due in 55 days and another payment of $3,600 is due in 300 days.
Calculate the single equivalent payment to be made in 55 days to settle the two payments if
money earns 8.59% p.a. (Hint: use 55 days from now as the focal date.) $

Solution

by Bartleby Expert

SEE SOLUTION

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Three payments are scheduled as follows: $1,500 is due today, $1,200 is due in five months, and $2,100 is due in eight months. The three payments are to be replaced by a single equivalent payment due ten months from now. What should the payment be if money is worth 6.5%? Use ten months from now as the focal date. (Do not round intermediate calculations and round your final answer to 2 decimal places.) Payment LA
You are consldering taking out a loan of $11,000.00 that will be pald back over 9 years with every 2 months payments of $269.03. If the interest rate is 6.4% compounded every 2 months, what would the unpaid balante be Immediately after the eleventh payment? The unpald balance would be $ (Round to 2 decimal places.)
Scheduled payments of $1054, $789, and $508 are due in one-and-a-half years, four years, and six years respectively. What is the equivalent single replacement payment three years from now if interest is 2.3% compounded annually?
Scheduled payments of $338, $859, and $1011 are due in one year, four years, and six years respectively. What is the equivalent single replacement payment two-and-a-half years from now if interest is 5.4% compounded monthly?
Payments of $4,000, $5,200 and $6,500 are due in four months, sixteen months and eighteen months respectively. What is the equivalent payment one year from now if money is worth 6% compounded quarterly?
Scheduled payments of $890 due today, $525 due in 15 months, and $555 due in 33 months are to be replaced by a single equivalent amount paid at the focal date of 6 months from today. Money earns 11.1% compounded quarterly. Using P/Y=C/Y=4 and PMT=0, determine the economically equivalent value for each amount at the focal date and enter the values in the blanks. In your rough work, it may be helpful to draw a timeline with the appropriate focal date for the unknown amount. Round dollar values to 2 decimal places. Moving $890 due today to the focal date: A PV = N= A FV= Moving $525 due in 15 months to the focal date: N = A/ PV = Moving $555 due in 33 months to the focal date: N = A/ PV = The single amount at the focal date is = A FV= A FV = A/ A A/
A leasing contract calls for an immediate payment of $108,000 and nine subsequent $108,000 semiannual payments at six-month intervals. What is the PV of these payments if the annual discount rate is 12%? (Hint: First find the semiannual rate that is equivalent to the annual rate.) Note: Do not round intermediate calculations. Round your answer to 2 decimal places.
What equal payments in 3 years and 4 years would replace payments of $32,500 and $62,500 in 7 years and 8 years, respectively? Assume money can earn 3.54% compounded semi-annually. Use 8 years as the focal date.
scheduled payments of 400$ due now and 700$ due in five months are to be settled by payment of 500$ in three months and final payment in 8 months. determine the amount of the final payment at 6% p.a, using 8 months from now as fhthe focal date
Loan payments of $1725 due today, $510 due in 75 days, and $655 due in 323 days are to be combined into a single payment to be made 115 days from now. What is that single payment if money is worth 8.5% p.a. and the focal date is 115 days from now?