**Insurance Settlement Calculation**Apollo Enterprises has been awarded an insurance settlement of **$6,000** at the end of each 6-month period for the next **13 years**. (Round your answers to the nearest cent.)**(a)** As the accountant, calculate how much (in $) the insurance company must set aside now at 6% interest compounded semiannually to pay this obligation to Apollo.\[ \text{\$} \_\_\_\_\_\_ \]**(b)** How much (in $) would the insurance company have to invest now if the Apollo settlement was changed to **$3,000** at the end of each 3-month period for **13 years** and the insurance company earned 8% interest compounded quarterly?\[ \text{\$} \_\_\_\_\_\_ \]**(c)** How much (in $) would the insurance company have to invest now if the Apollo settlement was paid at the beginning of each 3-month period rather than at the end?\[ \text{\$} \_\_\_\_\_\_ \]

A)PV= PMT(1-(1+r/n)-nt)/(r/n) PMT=6000 r=6% n=2 For semi annually t=13 years…

T NOTES ASK YOUR TEACHEI Apollo Enterprises has been awarded an insurance settlement of $6,000 at the end of each 6 month period for the next 13 years. (Round your answers to the nearest cent.) (a) As the accountant, calculate how much (in $) the insurance company must set aside now at 6% interest compounded semiannually to pay this obligation to Apollo. %2$ (b) How much (in $) would the insurance company have to invest now if the Apollo settlement was changed to $3,000 at the end of each 3 month period for 13 years and the insurance company earned 8% interest compounded quarterly? 24 (c) How much (in $) would the insurance company have to invest now if the Apollo settlement was paid at the beginning of each 3 month period rather than at the end? %24

T NOTES ASK YOUR TEACHEI Apollo Enterprises has been awarded an insurance settlement of $6,000 at the end of each 6 month period for the next 13 years. (Round your answers to the nearest cent.) (a) As the accountant, calculate how much (in $) the insurance company must set aside now at 6% interest compounded semiannually to pay this obligation to Apollo. %2$ (b) How much (in $) would the insurance company have to invest now if the Apollo settlement was changed to $3,000 at the end of each 3 month period for 13 years and the insurance company earned 8% interest compounded quarterly? 24 (c) How much (in $) would the insurance company have to invest now if the Apollo settlement was paid at the beginning of each 3 month period rather than at the end? %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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