Ruth Altidore invested $6,000 at 11% annual interest, and left the money invested without withdrawing any of the interest for 14 years. At the end of the 14 years, Ruth withdrew the accumulated amount of money. Click here to view the factor table. (For calculation purposes, use 5 decimal places as displayed in the factor table provided.) (a) What amount did Ruth withdraw, assuming the investment earns simple interest? The amount Ruth withdrew (b) What amount did Ruth withdraw, assuming the investment earns interest compounded annually? (Round answer to 2 decimal places, e.g. 25.25.) The amount Ruth withdrew $ %24

Ruth Altidore invested $6,000 at 11% annual interest, and left the money invested without withdrawing any of the interest for 14 years. At the end of the 14 years, Ruth withdrew the accumulated amount of money. Click here to view the factor table. (For calculation purposes, use 5 decimal places as displayed in the factor table provided.) (a) What amount did Ruth withdraw, assuming the investment earns simple interest? The amount Ruth withdrew (b) What amount did Ruth withdraw, assuming the investment earns interest compounded annually? (Round answer to 2 decimal places, e.g. 25.25.) The amount Ruth withdrew $ %24

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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TO DO: Answer the questions below related to if simple interest versus compound interest were at play. Willie invested $6,000 at 5% annual interest, and left the money invested without withdrawing any of the interest for 12 years. At the end of the 12 years, Willie withdrew the accumulated amount of money. (a) What amount did Willie withdraw, assuming the investment earns simple interest? (b) What amount did Willie withdraw, assuming the investment earns interest compounded annually? Megan Company earns 6% on an investment that will return $450,000 8 years from now. What is the amount Megan should invest now, assuming the 6% will be constant, to have $450,000 in 8 years? TIP: The present value formula will be easiest (if that formula makes sense). You can also use the future value and "play" with numbers to see what makes it work. Finally, you could also set up a small spreadsheet to use numbers to get the desired math to work. Reach out if you are struggling.
3. Brittney won $765,000 in a lawsuit against MIT over theft of intellectual property. She and Santana decide to invest the money in a college fund for their 5-year-old daughter. How much will they have when their daughter is 18? Calculate the balance for each of the following account options: a. 4.36% APR interest compounded continuously b. 4.49% APR interest compounded quarterly c. 4.6% APR interest compounded yearly
Kia deposited $1,300, at the BEGINNING of each year for 26 years in a credit union account. If the account paid 8% interest, compounded annually, use the appropriate formula to find the future value of her account. $95,037.72$103,940.74 $112,256.00$113,556.00
Frank invests $ 2500 dollars into an account earning interest compounded quarterly. After 13 years there is $ 3050 in the account. What was the interest rate?
(a) Heather borrowed $5000 from her grandmother as a down payment on her first car. She promised to repay the debt in 2 years at 7% per annum, simple interest. How much should Heather repay her grandmother? (b) How much must Jason deposit in a special account paying interest at the rate of 9.5% to receive $75.21 in interest after 6 months? (c) An investment of $4500 gained $337.50 in intesest in 9 months. What rate of yearly intesest did the investment pay?
James and Mary Garfield invested $5,000 in a savings account paying 4% annual interest when their daughter, Patricia, was born. They also deposited $1,000 on each of her birthdays until she was 14 (including her 14th birthday). Click here to view the factor table. How much was in the savings account on her 14th birthday (after the last deposit)? (For calculation purposes, use 5 decimal places as displayed in the factor table provided. Round answer to 2 decimal places, e.g. 25.25.) Amount on 14th birthday $
Subject : Accounting
On March 31, year 1, Mary borrowed $240,000 to buy her principal residence. Mary paid 3 points to reduce her interest rate from 6 percent to 5 percent. The loan is for a 30-year period. What is Mary's year 1 deduction for her points paid? Multiple Choice ___ $60. ___ $180. ___ $5,400. ___ $7,200.
Ahlam invests a certain fund worth OMR 6,000 in Bank Muscat for 3 years. At the end of this period, she obtains an amount of OMR 7,500. What is the interest amount offered by the bank to Ahlam? a. OMR 1,500 b. OMR 2,000 c. OMR 13,500 d. OMR 500
Luoxana contributed $5,000.00 every year into an RRSP for 18 years. "What nominal annual rate of interest will the RRSP earn if the balance in Luoxana's account just after she made her last contribution was $195,000.00?
During the current year, Finn and Claire, a married couple who use the cash method of accounting purchased a principal residence for $325,000. They paid $39,000 down and financed the remaining $286,000 of the purchase price with a 30-year mortgage. At the closing, they also paid $350 for an appraisal, $425 for a title search, and 2.5 points representing additional interest over the term of the loan. At the end of the year, Finn and Claire received a statement from the mortgage company indicating that $11,500 of their total monthly payments made during the year represents interest and $1,100 is a reduction of the principal What is the total amount Finn and Claire may deduct in the current year arising from the purchase and ownership of their home? Finn and Claire may deduct . Part 2 b. What is the treatment of the other items that are not deductible? A. The other closing costs are added to the market value of the home. B. The other closing…
a mother earned $15000.00 from royalties on her cookbook. She set aside 20% of this for a down payment for a new home. The balance will be used for her son's future education. She invested a portion of the money in a bank certificate of a deposit (cd account) that earns 4% and the remainder in a savings bond that earns 7%. IF the total interest earned after one year is $720.00, how much money was invested at each rate?