Question: Johnston Industries Ltd. plans to replace a warehouse in 9 years at an estimated cost of $400,000. To pay for the replacement, a sinking fund

Johnston Industries Ltd. plans to replace a warehouse in 9 years at an estimated cost of $400,000. To pay for the replacement, a sinking fund has been established into which equal payments are made at the end of every quarter. The fund is growing at 6.00% compounded quarterly.

a. What is the size of the quarterly payments?

Round up to the next cent

b. What is the sinking fund balance at the end of 5 years?

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