M11-10 (Algo) Computing Present Value of Complex Contract [LO 11-S1] As a result of a slowdown...
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M11-10 (Algo) Computing Present Value of Complex Contract [LO 11-S1] As a result of a slowdown in operations, Tradewind Stores is offering employees who have been terminated a severance package of $100,000 cash paid today; $100,000 to be paid in one year; and an annuity of $35,000 to be paid each year for 4 years. Required: What is the present value of the package assuming an interest rate of 9 percent? (Future Value of $1, Present Value of $1, Future Value Annuity of $1, Present Value Annuity of $1.) Note: Use appropriate factor(s) from the tables provided. Round the final answer to nearest whole dollar. Present Value M11-10 (Algo) Computing Present Value of Complex Contract [LO 11-S1] As a result of a slowdown in operations, Tradewind Stores is offering employees who have been terminated a severance package of $100,000 cash paid today; $100,000 to be paid in one year; and an annuity of $35,000 to be paid each year for 4 years. Required: What is the present value of the package assuming an interest rate of 9 percent? (Future Value of $1, Present Value of $1, Future Value Annuity of $1, Present Value Annuity of $1.) Note: Use appropriate factor(s) from the tables provided. Round the final answer to nearest whole dollar. Present Value
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