In the notes to its December 31, 1996, balance sheet, how should Witt report the above data? a. No disclosure is required. b. Only sinking fund payments totaling $8,000,000 for the next five years detailed by year need be disclosed. c. Only maturities totaling $9,500,000 for the next five years detailed by year need be disclosed. d. The combined aggregate of $17,500,000 of

In the notes to its December 31, 1996, balance sheet, how should Witt report the above data? a. No disclosure is required. b. Only sinking fund payments totaling $8,000,000 for the next five years detailed by year need be disclosed. c. Only maturities totaling $9,500,000 for the next five years detailed by year need be disclosed. d. The combined aggregate of $17,500,000 of

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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A corporation will make the following disbursements: 50,000.00 on December 31, 2001 100,000.00 on December 31, 2002 200,000.00 on December 31, 2003 To accumulate these sums, a sinking fund is established by making equal year-end deposits starting December 31, 1996 up to the end of 2003. if the fund earns 9% interest compounded annually, what is the required amount of the annual deposit?
Using the information that the Amount of $1 per annum for 8 years at 5% is 9.5491, calculate the Annual Sinking Fund (ASF) $1 for 8 years at 59%. 0.0544 0.0994 0.0873 0.1047
What equal series of payments must be paid into a sinking fund in order toaccumulate each given amount?(a) $1,700 in 10 years at 8% compounded semiannually when payments aresemiannual.(b) $9,000 in 6 years at 3% compounded quarterly when payments arc quarterly.(c) $4,000 in 2 years at 12% compounded monthly when payments are monthly.
5. A debt of $250,000 is to be repaid after 5 years. If the interest is charged at 5% compounded semi-annually, a sinking fund is created at a rate of 6% compounded semi-annually. Find: a) the semi-annual cost by the sinking fund method; b) the semi-annual cost by amortization; c) Did the borrower made the right decision in setting up a sinking fund? Justify your answer.
1. For the year 2020, the permanent fund requirement of DICE Co. has been estimated as P 70,000. The total fund requirements are given as follows: Current Assets. Fixed AssetsFirst Quarter. 20,000 60,000Second quarter. 27,500. 60,000Third quarter 30,000. 60,000Fourth quarter 19,000. 60,000 a). Compute for the seasonal fund requirements
$150,000 is deposited in a fund that pays 5% annual compound interest for 2 years, 3% annual compound interest for 2 years, and 4% annual compound interest for 2 years. If uniform annual withdrawals occur over the 6-year period, what will be the magnitude of the annual withdrawals? a. $27,689.63b. $28,614.29 c. $28,804.50 d. $29,552.62
The following expenses will be incurred by company X: next year = P50k, 2015 = P70k , 2016 = P100k and 2017 = P150k. To accumulate these sums, a fund is established by making equal year end deposits starting 2010 to 2015. If the fund earns 15% compounded annually, what is the required amount deposit? Select one: a. P42.375.716 b. P30,486.388 c. P37,455.777 d. P47,375.777
Using the sinking fund table, complete: Required Amount Needed Freq of Payment Years Interest Rate Payment Amount end of each period $40,000 Quarterly 7 8%
1. For the year 2020, the permanent fund requirement of DICE Co. has been estimated as P 70,000. The total fund requirements are given as follows: Current Assets. Fixed AssetsFirst Quarter. 20,000 60,000Second quarter. 27,500. 60,000Third quarter 30,000. 60,000Fourth quarter 19,000. 60,000 a). Compute for the seasonal fund requirements b) Compute for the following under aggressive and conservative strategies: 1. short-term funds 2. working capital excess
1. For the year 2020, the permanent fund requirement of DICE Co. has been estimated as P 70,000. The total fund requirements are given as follows: Current Assets. Fixed AssetsFirst Quarter. 20,000 60,000Second quarter. 27,500. 60,000Third quarter 30,000. 60,000Fourth quarter 19,000. 60,000 a). Compute for the seasonal fund requirements b) Compute for the following under aggressive and conservative strategies: 1. Total fund requirements 2. long-term fund 3. short-term funds 4. working capital excess
Sinking FundPayment PaymentFrequency TimePeriod (years) NominalRate (%) InterestCompounded Future Value(Objective) $ every 3 months 3 6.0 quarterly $9,000
3. Find the interest rate needed for the sinking fund to reach the required amount. Assume that the compounding period is the same as the payment period. FU $13,690 to be accumulated in 3 years; quarterly payments of $1025 The interest rate needed is approximately %. (Type an integer or decimal rounded to two decimal places as needed.)