John Rider wants to accumulate $75,000 to be used for his daughter's college education. He would...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
John Rider wants to accumulate $75,000 to be used for his daughter's college education. He would like to have the amount available on December 31, 2026. Assume that the funds will accumulate in a certificate of deposit paying 8% interest compounded annually. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Answer each of the following independent questions. Required: 1. If John were to deposit a single amount, how much would he have to invest on December 31, 2021? 2. If John were to make five equal deposits on each December 31, beginning a year later, on December 31, 2022, what is the required amount of each deposit? 3. If John were to make five equal deposits on each December 31, beginning now, on December 31, 2021, what is the required amount of each deposit? (For all requirements, Round your final answers to nearest whole dollar amount.) 1. Amount 2. Annuity amount 3. Annuity amount John Rider wants to accumulate $75,000 to be used for his daughter's college education. He would like to have the amount available on December 31, 2026. Assume that the funds will accumulate in a certificate of deposit paying 8% interest compounded annually. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Answer each of the following independent questions. Required: 1. If John were to deposit a single amount, how much would he have to invest on December 31, 2021? 2. If John were to make five equal deposits on each December 31, beginning a year later, on December 31, 2022, what is the required amount of each deposit? 3. If John were to make five equal deposits on each December 31, beginning now, on December 31, 2021, what is the required amount of each deposit? (For all requirements, Round your final answers to nearest whole dollar amount.) 1. Amount 2. Annuity amount 3. Annuity amount
Expert Answer:
Answer rating: 100% (QA)
Answer Amount required on 31Dec2026 75000 Rate of Interest r8 compoun... View the full answer
Related Book For
Intermediate Accounting
ISBN: 978-0077400163
6th edition
Authors: J. David Spiceland, James Sepe, Mark Nelson
Posted Date:
Students also viewed these accounting questions
-
Answer each of the following independent questions concerning supplies and the adjustment for supplies. (a) The balance in the supplies account, before adjustment at the end of the year, is $2,100....
-
John Rider wants to accumulate $100,000 to be used for his daughter's college education. He would like to have the amount available on December 31, 2016. Assume that the funds will accumulate in a...
-
If you deposit $15,000 today in a Certificate of Deposit and earn 1% annual interest, how much will you have in 8 years? Using excel work funtion (PV)
-
The schedule of accounts receivable, schedule of accounts payable and trial balance for Let it Snow are shown below. Schedule of Accounts Receivable as at 31 May 20XX Customer Invoice No. Terms Date...
-
Transform the following sinusoids to phasors: (a) -10 cos (4t + 75o) (b) 5 sin(20t - 10o) (c) 4 cos2t + 3 sin 2t
-
Required 1. What price should be used for Option 1 (Status Quo Pricing)? 2. What price should be used for Option 2 (Competition-Based Pricing)? 3. What price should be used for Option 3 (Cost-Plus...
-
Discuss what steps can be taken in the healthcare setting to help prevent the spread of AIDS.
-
Prepare journal entries to record the following merchandising transactions of Cabela's, which uses the perpetual inventory system and the gross method. July 1 Purchased merchandise from Boden Company...
-
Find the following (in m) for the path in the figure below. (a) the total distance traveled m (b) the displacement from start to finish m 10 12 x (m)
-
Ben Wicks was a tremendously successful Canadian cartoonist whose work appeared in over 270 newspapers worldwide. He produced thousands of drawings during his career, and he wanted to keep them all....
-
You are asked to calculate a food corporation's cost of capital for different division. This corporation has three divisions of restaurant, snack food and beverages. Information on each division's...
-
Let us consider a European-style put option on a non-dividend-paying asset whose price follows a GBM with drift 10% and volatility 40% (annualized). The risk-free rate is 5% with continuous...
-
Why do you think the atria of the heart are less muscular than the ventricles? Why is the left ventricle more muscular than the right ventricle?
-
Explain what happens when a B cell first encounters a pathogen and binds to an antigen on the pathogen.
-
How do you inhale?
-
How does fluid move from the circulatory system into a nephron?
-
Since the birth of his daughter, 17 years ago, Kimberly has deposited $150 at the beginning of every month into a Registered Education Savings Plan (RESP). The interest rate on the plan was 5.50%...
-
Which provision could best be justified as encouraging small business? a. Ordinary loss allowed on $ 1244 stuck. b. Percentage depletion. c. Domestic production activates deductions. d. Interest...
-
Describe the primary differences between IFRS and U.S. GAAP in the way leases are classified as either operating or finance (capital) leases.
-
Income statement and balance sheet information abstracted from a recent annual report of The Kroger Company, one of the world's largest retailers, appears below: The significant accounting policies...
-
Hudson Company, which is both a wholesaler and a retailer, purchases its inventories from various suppliers. Additional facts for Hudson's wholesale operations are as follows: a. Hudson incurs...
-
By using the yield to maturity on AT&Ts debt, we found that its pretax cost of debt is 3.65%. If AT&Ts tax rate is 25%, what is its effective cost of debt?
-
You work in Walt Disney Companys corporate finance and treasury department and have been assigned to the team estimating Disneys WACC. You must estimate this WACC in preparation for a team meeting...
-
You are working for Microsoft evaluating the possibility of selling energy drinks. Microsofts WACC is 8.1%. Energy drinks would be a new line of business for Microsoft, however, so the systematic...
Study smarter with the SolutionInn App