Silk Bakery and Co. budgeted $331,000 to build a factory 9 years from today. Silk will finance the project by making five equal annual deposits of $54,000 at the end of each year commencing four years from today. The company can invest in a financial instrument earning 7%. Interest is compounded annually.

Requirement

What is the Future Value of this cash flow?

Will Silk have sufficient funds to pay for the $331,000 factory at the end of the 9-year period?

Answer rating: 100% (QA)

interest rates 7 Annual deposit 54000 Payments are made at end of pe... View the full answer