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this year, how many more festivals can be sponsored without raising more money? Think carefully!

this year, how many more festivals can be sponsored without raising more money? Think carefully!

FINANCIAL ACCOUNTING
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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5-2 It takes $10,000 to put on the local art festival each year. Immediately before_this year's festival, the sponsoring committee determined that it had $60,000 in an account paying 8% interest. After this year, how many more festivals can be sponsored without raising more money? Think carefully! Solution 60,000 - 10,000 = 10,000(P/A, 8%, n) (P/A, 8%, n) = 50,000/10,000 = 5 From the i = 8% table n = 6 This is the number of festivals after this year's. There will be some money left over but not enough to pay for a 7th year.
Transcribed Image Text:5-2 It takes $10,000 to put on the local art festival each year. Immediately before_this year's festival, the sponsoring committee determined that it had $60,000 in an account paying 8% interest. After this year, how many more festivals can be sponsored without raising more money? Think carefully! Solution 60,000 - 10,000 = 10,000(P/A, 8%, n) (P/A, 8%, n) = 50,000/10,000 = 5 From the i = 8% table n = 6 This is the number of festivals after this year's. There will be some money left over but not enough to pay for a 7th year.
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