On September 8, Bert Sarkis joined a Christmas club. His bank will automatically deduct $65 from his checking account at the end of each month and deposit it into his Christmas club account, where it will earn 7% interest. The account comes to term on December 1. (a) Find the future value of the account, using an annuity formula. (Round your answer to the nearest cent.) $ (b) Find the future value of the account, using the compound interest formula. (Round your answer to the nearest cent.) $ (c) Find Bert's total contribution to the account. $ (d) Find the total interest. (Round your answer to the nearest cent.) $

On September 8, Bert Sarkis joined a Christmas club. His bank will automatically deduct $65 from his checking account at the end of each month and deposit it into his Christmas club account, where it will earn 7% interest. The account comes to term on December 1. (a) Find the future value of the account, using an annuity formula. (Round your answer to the nearest cent.) $ (b) Find the future value of the account, using the compound interest formula. (Round your answer to the nearest cent.) $ (c) Find Bert's total contribution to the account. $ (d) Find the total interest. (Round your answer to the nearest cent.) $

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

ChapterM: Time Value Of Money Module

Section: Chapter Questions

Problem 4MC: Refer to the present value table information on the previous page. What amount should Brett have in...

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Concept explainers

Cost of Credit

The cost of credit is an extra amount that the borrower has to pay besides the loan amount. These credit charges may vary from loan to loan. The cost of credit includes interest charges, maintenance charges, and arrangement charges. Some of the costs are mandatorily collected by the lender based on the loan amount and tenure of the loan. The cost of credit is also called finance charges of the credit.

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On September 8, Bert Sarkis joined a Christmas club. His bank will automatically deduct $65 from his checking account at the end of each month and deposit it into his Christmas club account, where it will earn 7% interest. The account comes to term on December 1.

(a) Find the future value of the account, using an annuity formula. (Round your answer to the nearest cent.)

\$ [ ]

(b) Find the future value of the account, using the compound interest formula. (Round your answer to the nearest cent.)

\$ [ ]

(c) Find Bert's total contribution to the account.

\$ [ ]

(d) Find the total interest. (Round your answer to the nearest cent.)

\$ [ ]

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