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...

See similar textbooks

Related questions

Q: Directions: Determine whether each of the following situation is Simply Annuity or General Annuity.…

A: Hi There, thanks for posting the question. But as per Q&A guidelines, we must answer the first…

Q: Jane has a credit card balance of $21,000. The annual interest rate is 20%. She is required to pay a…

A: Given: Credit card balance = $21,000 Annual interest rate = 20% Minimum payment = 4% Additional…

Q: A personal account earmarked as a retirement supplement contains $292,400. Suppose $250,000 is used…

A: Annuity refers to the series of payment in equal interval of time for certain time period. For…

Q: Find the future value of each using the future value of an ordinary annuity formula. Priscilla…

A: A study that proves that the future worth of the money is lower than its current value due to…

Q: Jane Adele deposits $1,700 in an account at the beginning of each 3-menth period for 12 years. If…

A: If the amount is deposited at end of each period, then such annuity is called ordinary annuity. If…

Q: Joshua borrowed $800 for one year and paid $40 in interest. The bank charged him a service charge of…

A: Annual Percentage Rate (APR) is the actual annual cost incurred by the borrower on the amount…

Q: Dick Eckel recently set up a TDA to save for his retirement. He arranged to have $135 taken out of…

A: Given: PMT =$135Rate =978% i.e. 9.875% There are 26 biweeks in a year i.e. n=26 years Payment will…

Q: Adrian received the proceeds from an inheritance on May 14. He wants to set aside enough on May 15…

A: Simple interest is calculated directly on the given principal amount. The formula for calculating…

Q: None

A: To calculate for the Present value of annuity , the formula isPresent value of annuity = P * [ 1-…

Q: PLEASE ANSWER IT ASAP FOR AN UPVOTE. I REALLY NEED IT NOW. 2. Jake deposits 1200 pesos at the end of…

A: Future value of annuity is the future value of all the stream of cash flows.

Q: To start a new business, Alysha intends to borrow $19,000 from a local bank. If the bank asks her to…

A: When the borrower borrows a loan from the lender, he has to pay a rate of interest on the borrowed…

Q: Jim makes a deposit of $12,000 in a bank account. The deposit is to earn interest compounded…

A: Deposit $12,000 a)Calculate future value compounded annually 6% for 7 years.b).Calculate Future…

Q: Suat opens a deposit account in a bank by depositing 10,000 TL. In addition, he will deposit 6,000…

A: Initial Deposit = 10,000 Deposit after one year = 6000 Deposit after two years = 4000 Value in…

Q: A personal account earmarked as a retirement supplement contains $292,200. Suppose $250,000 is used…

A: Let the required annuity be = n quarters To make the account 0 at the end of the annuity period, the…

Q: Imelda opens a savings account with $12,000, which pays an annual interest rate of 7.8%. If she…

A: Future value of the amount that is invested and also amount of interest accumulated over the period…

Q: On August 1, Rachael Westlake joined a Christmas Club. Her bank will automatically deduct $135 from…

A: The present value of an ordinary annuity(payment due at end month), can be calculated by using this…

Q: Elizabeth Brown has $23,000 that she can deposit into a savings account for five years. Bank A…

A: Here, we need to calculate the future value of the amount deposited today at a given interest rate…

Q: Samuel wants to make regular annual payments of size P dollars into an annuity that pays interest…

A: Given : Samuel wants to make regular annual payments of size P dollars into an annuity that pays the…

Q: On the day his son was born, a father deposited to a trust company a sufficient amount of money so…

A: Future value of an investment is the value of total money in the investment account at a future…

Q: local bank will pay you $135 a year for your lifetime if you deposit $3,000 in the bank today. If…

A: Annuity=$135Today value=$3000

Q: Label all final answers with the correct units, if applicable. Unless otherwise stated, use 4…

A: Future value of the amount is that is being deposited over the time and amount of interest…

Q: Jerry signs a $16,000 loan for the purchase of a new car. The terms is for 48 months, at an…

A: The question is based on the concept of Financial Management.

Q: To rent an apartment, Nick has to pay the first month of rent plus the last month of rent and a…

A: Under the cash advancement on the credit card system, the borrower is able to borrow money and has…

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.

Question

100%

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.)

\$ [ ]

Expert Solution

This question has been solved!

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

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1: Given Information:

Step 2: Calculation:

Step 3: Calculation:

Step 4: Calculation:

Trending now

This is a popular solution!

Step by step

Solved in 4 steps with 2 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

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

Similar questions

On August 1, Rachael Westlake joined a Christmas Club. Her bank will automatically deduct $120 from her checking account at the end of each month and deposit it into her Christmas Club account, where it will earn 67% interest. The account comes to term on December 1. (Round your answers to the nearest cent.) (a) Find the present value of the given annuity. $ X (b) Interpret the present value of the given annuity. You would have to invest a lump sum of $ X now instead of $120 per month.
On August 1, Rachael Westlake joined a Christmas Club. Her bank will automatically deduct $105 from her checking account at the end of each month and deposit it into her Christmas Club account, where it will earn 6 7 8 % interest. The account comes to term on December 1. (Round your answers to the nearest cent.) (a) Find the present value of the given annuity.$ (b) Interpret the present value of the given annuity. You would have to invest a lump sum of $ now instead of $105 per month.
On August 1, Rachael Westlake joined a Christmas Club. Her bank will automatically deduct $120 from her checking account at the end of each month and deposit it into her Christmas Club account, where it will earn 6 7/8% interest. The account comes to term on December 1. (Round your answers to the nearest cent.) (a) Find the present value of the given annuity.(b) Interpret the present value of the given annuity.
On September 8, Bert Sarkis started an annuity. He arranged to have $60 deducted from his end-of-month paychecks. The money would earn 7% interest compounded monthly. (a) Find the future value of the account on December 1 using an Amortization Formula. (Round your answer to the nearest cent.) $ 10280 X (b) Find the future value of the account on December 1 by applying the Compound Interest Formula to each payment individually. (Round your answer to the nearest cent.) 5.75 X (c) Find Bert's total contribution to the account. $ 2356.176 x (d) Find the total interest. (Round your answer to the nearest cent.) $ 7923.824 X
Adrian received the proceeds from an inheritance on May 14. He wants to set aside enough on May 15 so that he will have $21,000 available on October 8 to purchase a car when the new models are introduced. If the current interest rate on 1- to 180-day deposits is 6 00%, what amount should he place in the term deposit? For full marks your answer(s) should be rounded to the nearest cent Click here for help computing the number of days between two dates Principal = $ 0.00
Mr. Jerome has an outstanding balance of $12000 on his credit card. The interest rate on the card is 12% he intends to pay off the card in 2 years. Find the APR on the card.
A person is planning to deposit RO 1000 in a bank at the end of first year. Thereafter, he wishes to deposit the amount with an annual increase of RO 100 for the next 7 years. The bank gives an interest of 6%, compounded annually. Determine the total amount that would be accumulated to his account by the end of 8th year.
please step by step solution.
Pascal has recently opened an RRSP. He plans to deposit $ 965 at the end of every month for 20 years. The account will compound interest semi-annually at the nominal rate of 5.9 %. How much money will Pascal have in his account immediately after his last deposit? a. $ 410717.66 b. $ 410717.66 c. $ 454411.03 d. $ 436933.68 e. $ 410717.66
PLEASE ANSWER IT ASAP FOR AN UPVOTE. I NEED IT NOW. 3. Karen deposits P100 at the beginning of each month into an annuity that pays a 6% annual interest at the end of each year. How much will she have in this account at the end of 5 years? (
In ten years time a person would like to have accumulated $22,109 so they can make a down payment on a house. How much do they need to deposit today at an annual interest rate of 9.98% if the account compounds semiannually? Enter a number rounded to two decimal places.
Pedro deposits four installments in his savings account as follows: BRL 2500 initial deposit (today); BRL 5000 after 3 months; BRL 9000 after 10 months; BRL 7000 after 16 months; Since all deadlines are related to the first deposit, calculate the balance at the time of the last deposit, since the rate is 2% per month. The balance on the last deposit will be R$ ?