I did the “required 1” but stuck on how to do “required 2” Exercise 5-10 (Algo) Future and present value [LO5-3, 5-7, 5-8]Answer each of the following independent questions.Alex Meir recently won a lottery and has the option of receiving one of the following three prizes: (1) $60,000 cash immediately, (2)$18,000 cash immediately and a six-period annuity of $7,500 beginning one year from today, or (3) a six-period annuity of $11,800beginning one year from today. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) fromthe tables provided.)1. Assuming an interest rate of 5%, determine the present value for the above options. Which option should Alex choose?2. The Weimer Corporation wants to accumulate a sum of money to repay certain debts due on December 31, 2030. Weimer will makeannual deposits of $105,000 into a special bank account at the end of each of 10 years beginning December 31, 2021. Assuming thatthe bank account pays 6% interest compounded annually, what will be the fund balance after the last payment is made on December31, 2030?Complete this question by entering your answers in the tabs below.Required 1Required 2The Weimer Corporation wants to accumulate a sum of money to repay certain debts due on December 31, 2030. Weimer willmake annual deposits of $105,000 into a special bank account at the end of each of 10 years beginning December 31, 2021.Assuming that the bank account pays 6% interest compounded annually, what will be the fund balance after the last paymentis made on December 31, 2030? (Round your final answers to nearest whole dollar amount.)Show lessTable or calculator function:Payment:Future value:

Future Value of Annuity: It represents the future worth of the present annuity cash flow stream and…

ner will IKto a special bank account at the end of each of 10 years beginning December 31, 2021. Assuming that the bank account pays 6% interest compounded annually, what will be the fund balance after the last payment is made on December 31, 2030? (Round your final answers to nearest whole dollar amount.)

ner will IKto a special bank account at the end of each of 10 years beginning December 31, 2021. Assuming that the bank account pays 6% interest compounded annually, what will be the fund balance after the last payment is made on December 31, 2030? (Round your final answers to nearest whole dollar amount.)

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 11E

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5-21 EVALUATING LUMP SUMS AND ANNUITIES Kristina just won the lottery, and she must choose among three award options. She can elect to receive a lump sum today of $62 million, to receive 10 end-of-year payments of $9.5 million, or to receive 30 end-of-year payments of $5.6 million. a. If she thinks she can earn 7% annually, which should she choose? b. If she expects to earn 8% annually, which is the best choice?