An employee's compensation includes an annuity that pays $110,000 at retirement, with each subsequent annual payment growing by 2% for a total of 8 payments overall. The firm's policy is to p fund such annuities before retirement. At an interest rate of 5%, how much would the firm need to invest 3 years before retirement? Please round your answer to the nearest hundredth.
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- If Bergen Air Systems takes out a $100,000 loan, with eight equal principal payments due over the next eight years, how much will be accounted for as a current portion of a noncurrent note payable each year?A company wants to have $20,000 at the beginning of each 6-month period for the next 4years. If an annuity is set up for this purpose, how much must be invested now if the annuity earns 6.31%, compounded semiannually? (a) Decide whether the problem relates to an ordinary annuity or an annuity due. ordinary annuityannuity due (b) Solve the problem. (Round your answer to the nearest cent.)A company wants to have $50,000 at the beginning of each 6-month period for the next 4 1/2 years. If an annuity is set up for this purpose, how much must be invested now if the annuity earns 6.29%, compounded semiannually? (a) Decide whether the problem relates to an ordinary annuity or an annuity due. ordinary annuityannuity due (b) Solve the problem. (Round your answer to the nearest cent.) $
- A company wants to have $50,000 at the beginning of each 6-month period for the next 4.5 years. If an annuity is set up for this purpose, how much must be invested now if the annuity earns 6.23%, compounded semiannually?A client currently has $100,000 earmarked for retirement and expects a 7% annual return on the account both preretirement and post retirement. What is the income at the beginning of each month the account could provide for 20 years in retirement if the client is currently age 40 and plans to retire at age 67?Professor’s Annuity Corp. offers a lifetime annuity to retiring professors. For a payment of $81,000 at age 65, the firm will pay the retiring professor $625 a month until death. a. If the professor’s remaining life expectancy is 15 years, what is the monthly interest rate on this annuity? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) b. What is the effective annual interest rate? (Do not round intermediate calculations. Round your answer to 2 decimal places.) c. If the monthly interest rate is 0.75%, what monthly annuity payment can the firm offer to the retiring professor? (Do not round intermediate calculations. Round your answer to 2 decimal places.)
- Professor’s Annuity Corp. offers a lifetime annuity to retiring professors. For a payment of $76,000 at age 65, the firm will pay the retiring professor $500 a month until death. a. If the professor’s remaining life expectancy is 20 years, what is the monthly interest rate on this annuity? b. What is the effective annual interest rate? c. If the monthly interest rate is 1.00%, what monthly annuity payment can the firm offer to the retiring professor?A new employee plans to receive 760,000 TL individual retirement bonus when he retires. According to the forecast that this person will retire after 30 years, premium payments will be made at the end of each year and a compound interest rate of 14% will be applied each year; a) What is the premium amount to be deposited at the end of each year b) Draw the cash flow diagram for the transactions. c) Calculate the present value of the 760,000 TL bonus that this person will receive when she retires.A life insurance company will sell a 20 year annuity paying $1,600 at the end of each month for $175,000. What annual compounded nominal rate of interest will the annuitant earn?
- A retirement plan investment guarantees to pay you, or your estate, a fixed amount each year for 20 years. At the time of retirement, you will have accumulated $310,360 to your credit in the plan. The plan anticipates earning 8% interest annually over the period you or your estate will receive the retirement benefits. Rounding to the nearest $10, how much will the annual retirement benefits payment be assuming the first payment occurs one year from your retirement date?A man is planning to retire in 20 years. He can deposit money for his retirement at 8% compounded monthly. It is estimated that the future general innovation (J) rate will be 3% compounded annually. What deposit must be made each month until the man retires so that he can make annual withdrawals of $20,000 in terms of today's dollars. over the 15 years following his retirement? (Assume that his first withdrawal occurs at the end of the first six months after his retirement.)As part of your retirement plan, you have decided to deposit $9,000 at the beginning of each year into an account paying 5% interest compounded annually. (Round your answers to the nearest cent.) Explain A-E (a) How much (in $) would the account be worth after 10 years? $ (b) How much (in $) would the account be worth after 20 years? $ (c) When you retire in 30 years, what will be the total worth (in $) of the account? $ (d) If you found a bank that paid 6% interest compounded annually rather than 5%, how much (in $) would you have in the account after 30 years? $ (e) Use the future value of an annuity due formula to calculate how much (in $) you would have in the account after 30 years if the bank in part (d) switched from annual compounding to monthly compounding and you deposited $750 at the beginning of each month instead of $9,000 at the beginning of each year. $