Exercise 5-2 (Algo) Future value; single amount (LO 5-2)The four people below have the following investments.Invested InterestAmountRateCompounding$Jerry12%Quarterly12,000Elaine 15,0008SemiannuallyGeorge22,0007 Annually9AnnuallyKramer18,000Required:1-a. Calculate the future value at the end of four years. (FV of $1, PV of $1, FVA of $1, and PVA of $1)1-b. Who has the greatest investment accumulation?Complete this question by entering your answers in the tabs below.Req 1AReq 1BCalculate the future value at the end of four years.Note: Use Excel or a financial calculator. Round your answers to 2 decimal places.Future ValueJerryElaineGeorgeKramer< Req 1AReq 1B >

Computation of Future value of the investment made by Jerry :Jerry Invested Amount $12,000…

Answered: Exercise 5-2 (Algo) Future value;…

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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Term Rate (EAR %) 1 year 1.97 2 years 2.46 3 years 2.61 5 years 3.35 7 years 3.74 10 years 4.15 20 years 5.02 a. Calculate the present value of an investment that pays $1,000 in two years and $4,000 in five years for certain. b. Calculate the present value of receiving $200 per year, with certainty, at the end of the next five years. To find the rates for the missing years in the table, linearly interpolate between the years for which you do know the rates. (For example, the rate in year 4 would be the average rate in year 3 and year 5.) c. Calculate the present value of receiving $1,900 per year, with certainty, for the next 20 years. Infer rates for the missing years using linear interpolation. (Hint: Use a spreadsheet.) a. Calculate the present value of an investment that pays $1,000 in two years and $4,000 in five years for certain. The present value of the investment is $ (Round to the nearest cent.)
Q1/ Ipswich Corporation is considering an investment opportunity with the expected net cash inflows of $300,000 for four years. The residual value of the investment, at the end of four years, would be $70,000. The company uses a discount rate of 14%, and the initial investment is $290,000. Calculate the NPV of the investment. Present value of an ordinary annuity of $1: 12% 13% | 14% | 15% 0.893 0.885 0.877 0.87 2 1.69 |1.6681.647 1.626 32.402 2.361 2.322 2.283 43.037 2.974 2.914 2.855 3.605 3.517 3.4333.352 Present value of $1: 12% 13% | 14% | 15% 0.893 0.885 0.877 0.87 20.797 0.783 0.769|0.756 30.712 0.6930.675 0.658 40.636 0.6130.592|0.572 50.567 0.543 0.519|0.497
An annuity of 50 000 payable semi- annually for 5 years if the money is worth 6 % compounded quarterly. Give the values of the following variables: 1.) R = 2.) t = 3.) п%3 4.) r= 5.) p = 6.) с%3 7.) m = 8.) r/n = 9.) nt = 10. PV = %3D
Subject-Acounting
Week 3Fifteen years ago, you deposited $12,500 into an investment fund. Five years ago, you added anadditional $20,000 to that account. You earned 8%, compounded semi-annually, for the first ten years,and 6.5%, compounded annually, for the last five years.Required: a) What is the effective annual interest rate (EAR) you would get for your investment in the first 10 years?
Use the sinking fund formula shown to the right to determine the monthly payment needed to accumulate $560,000 with 9% interest are compounded monthly for 31 years. p=Arn1+rnnt−1 The monthly invested payment is $
What is the value today of receiving $4,000 at the end of two years, assuming an interest rate of 4% compounded semiannually? (FV of $1, PV of $1, FVA of $1, and PVA of $1). (Use appropriate factor(s) from the tables provided.) Multiple Choice $3,695 $4,195 $640 $3,698 tv A
P 9-1 Investment Scenarios (LO 9-3) Arkansas Best Freightways is considering a purchase of three different potential trucks. it is considering three different investment scenarios and their respective cash flows. Arkansas Best Freightways use a cost of capital of 9 percent to evaluate the investments. Year Year 0 (today) Year 1 Year 2 Year 3 Year 4 Buy new truck Increased profits Increased profits Increased profits Increased profits Net cash flows over life (not discounted) Investment 1 (85,000) 25,000 25,000 25,000 25,000 $ Investment 2 (105,000) 20,000 30,000 40,000 50,000 Required: 1. Calculate the net cash flows (not discounted) over the life of the three investments (years 0 to 4). (Negative amounts should be entered using a minus sign.) Answer is complete and correct. Investment 1 15,000 Investment 2 $ Investment 3 (125,000) 40,000 30,000 20,000 10,000 Investment 3 (25,000) 35,000 S Cost of Capital 9%
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