FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Question
For each requirement, change the values of the given information as shown and keep all other original data the same. Then enter your updated final answers for each scenario.
Scenario A:
Future value to be received | $ | 10,000 | |
Future date received | 3 | years | |
Discount Rate |
6% |
10% |
16% |
Scenario B:
Annual Cash Receipt | $ | 5,000 | |
Number of Years | 6 | years | |
Discount Rate |
6% |
10% |
16% |
Scenario C:
Discount Rate 8%
Investment Project | |||
Initial Investment | $ | (6,500) | |
Year 1 | $ | 700 | |
Year 2 | $ | 800 | |
Year 3 | $ | 1,400 | |
Year 4 | $ | 3,600 | |
Year 5 | $ | 6,800 | |
Required:
a. A company is expecting to receive a lump sum of money at a future date from now. Using the PV formula in Excel, what is the Present Value of that money at three different rates? (Round your answers to 2 decimal places.)
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