A couple who just had a girl decide to save up to pay the fees. of the
Question:
A couple who just had a girl decide to save up to pay the fees. of the child's university. It can create a university fund which bears interest on a annual rate of 7% assuming the child is starting university at the age of 18, the parents estimate that an amount of $40,000 per year will be necessary to cover university fees for 4 years.
Determine the equal annual amounts that the couple will have to set aside until admission of their daughter at university. (It is assumed that the first deposit will be made on the day of the child's first birthday and that the last deposit will take place on the day of his eighteenth birthday. The first withdrawal will occur at the start of the first year of university, when the child turns 18. Show your calculations in your working document. Support your answer with a diagram of monetary flows.
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill