On the day his grandson was born, a man deposited to a trust company so that the boy could receive five annual payments of P10,000 each for his college tuition fees, starting with his 18th birthday. Interest at the rate of 12% per annum was to be paid on all amounts on deposit. There was also a provision that the grandson could elect to withdraw the lump sum on his 25th birthday. The grandson chose this option. Draw a cash-flow diagram Question: (a) How much did the boy receive as a single payment? (b) How much did the grandfather deposit? 2. A car is to be paid P15,000 at 9% interest rate. What is the equivalent amount of car after 9 years at an annual interest rate of 6% compounded quart
On the day his grandson was born, a man deposited to a trust company so that the boy could receive five annual payments of P10,000 each for his college tuition fees, starting with his 18th birthday. Interest at the rate of 12% per annum was to be paid on all amounts on deposit. There was also a provision that the grandson could elect to withdraw the lump sum on his 25th birthday. The grandson chose this option. Draw a cash-flow diagram Question: (a) How much did the boy receive as a single payment? (b) How much did the grandfather deposit? 2. A car is to be paid P15,000 at 9% interest rate. What is the equivalent amount of car after 9 years at an annual interest rate of 6% compounded quart
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
ChapterM: Time Value Of Money Module
Section: Chapter Questions
Problem 4MC: Refer to the present value table information on the previous page. What amount should Brett have in...
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1. On the day his grandson was born, a man deposited to a trust company so that the boy could receive five annual payments of P10,000 each for his college tuition fees, starting with his 18th birthday. Interest at the rate of 12% per annum was to be paid on all amounts on deposit. There was also a provision that the grandson could elect to withdraw the lump sum on his 25th birthday. The grandson chose this option. Draw a cash-flow diagram
Question: (a) How much did the boy receive as a single payment? (b) How much did the grandfather deposit?
2. A car is to be paid P15,000 at 9% interest rate. What is the equivalent amount of car after 9 years at an annual interest rate of 6% compounded quarterly.
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