Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN: 9781337788281
Author: James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher: Cengage Learning
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help please answer in text form with proper workings and explanation for each and every part and steps with concept and introduction no AI no copy paste remember answer must be in proper format with all working!
Transcribed Image Text:4. An annuity of R1000 per annum from 1984 to 1988 inclusive, and R1200 per
annum from 1989 to 1993 Inclusive, is to be paid in equal half-yearly instalments
on the 30th June and 31st December of each year.
An intending purchaser of the annuity at 1st January, 1978 wishes to realize an
effective rate of interest of 5% per annum on the whole of his investment, and to
replace his capital by the end of 1993 by a level sinking fund to accumulate at an
effective rate of Interest of 4% per annum. What price should he pay?
9
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