Tony Ring wants to attend Northeast College. He will need $60,000 4 years from today. Assume Tony’s bank pays 12% interest compounded semiannually. Amount needed $ 60,000.00 Length of time needed from today 4 Interest 12% Compounded Semiannually Required: Complete the following using the information above and the present value Table 12.3 or the present value table in the Business Math Handbook to answer the following: Period used: Rate used: Factor used: What must Tony deposit today so he will have $60,000 in 4 years? Present value of $1 at end of period Period 1% 1½% 2% 3% 4% 5% 6% 7% 8% 9% 10% 1 .9901 .9852 .9804 .9709 .9615 .9524 .9434 .9346 .9259 .9174 .9091 2 .9803 .9707 .9612 .9426 .9246 .9070 .8900 .8734 .8573 .8417 .8264 3 .9706 .9563 .9423 .9151 .8890 .8638 .8396 .8163 .7938 .7722 .7513 4 .9610 .9422 .9238 .8885 .8548 .8227 .7921 .7629 .7350 .7084 .6830 5 .9515 .9283 .9057 .8616 .8219 .7835 .7473 .7130 .6806 .6499 .6209 6 .9420 .9145 .8880 .8375 .7903 .7462 .7050 .6663 .6302 .5963 .5645 7 .9327 .9010 .8706 .8131 .7599 .7107 .6651 .6227 .5835 .5470 .5132 8 .9235 .8877 .8535 .7894 .7307 .6768 .6274 .5820 .5403 .5019 .4665 9 .9143 .8746 .8368 .7664 .7026 .6446 .5919 .5439 .5002 .4604 .4241 10 .9053 .8617 .8203 .7441 .6756 .6139 .5584 .5083 .4632 .4224 .3855 11 .8963 .8489 .8043 .7224 .6496 .5847 .5268 .4751 .4289 .3875 .3505 12 .8874 .8364 .7885 .7014 .6246 .5568 .4970 .4440 .3971 .3555 .3186 13 .8787 .8240 .7730 .6810 .6006 .5303 .4688 .4150 .3677 .3262 .2897 14 .8700 .8119 .7579 .6611 .5775 .5051 .4423 .3878 .3405 .2992 .2633 15 .8613 .7999 .7430 .6419 .5553 .4810 .4173 .3624 .3152 .2745 .2394 16 .8528 .7880 .7284 .6232 .5339 .4581 .3936 .3387 .2919 .2519 .2176 17 .8444 .7764 .7142 .6050 .5134 .4363 .3714 .3166 .2703 .2311 .1978 18 .8360 .7649 .7002 .5874 .4936 .4155 .3503 .2959 .2502 .2120 .1799 19 .8277 .7536 .6864 .5703 .4746 .3957 .3305 .2765 .2317 .1945 .1635 20 .8195 .7425 .6730 .5537 .4564 .3769 .3118 .2584 .2145 .1784 .1486 21 .8114 .7315 .6598 .5375 .4388 .3589 .2942 .2415 .1987 .1637 .1351 22 .8034 .7207 .6468 .5219 .4220 .3418 .2775 .2257 .1839 .1502 .1228 23 .7954 .7100 .6342 .5067 .4057 .3256 .2618 .2109 .1703 .1378 .1117 24 .7876 .6995 .6217 .4919 .3901 .3101 .2470 .1971 .1577 .1264 .1015 25 .7798 .6892 .6095 .4716 .3751 .2953 .2330 .1842 .1460 .1160 .0923 26 .7720 .6790 .5976 .4637 .3607 .2812 .2198 .1722 .1352 .1064 .0839 27 .7644 .6690 .5859 .4502 .3468 .2678 .2074 .1609 .1252 .0976 .0763

Tony Ring wants to attend Northeast College. He will need $60,000 4 years from today. Assume Tony’s bank pays 12% interest compounded semiannually. Amount needed $ 60,000.00 Length of time needed from today 4 Interest 12% Compounded Semiannually Required: Complete the following using the information above and the present value Table 12.3 or the present value table in the Business Math Handbook to answer the following: Period used: Rate used: Factor used: What must Tony deposit today so he will have $60,000 in 4 years? Present value of $1 at end of period Period 1% 1½% 2% 3% 4% 5% 6% 7% 8% 9% 10% 1 .9901 .9852 .9804 .9709 .9615 .9524 .9434 .9346 .9259 .9174 .9091 2 .9803 .9707 .9612 .9426 .9246 .9070 .8900 .8734 .8573 .8417 .8264 3 .9706 .9563 .9423 .9151 .8890 .8638 .8396 .8163 .7938 .7722 .7513 4 .9610 .9422 .9238 .8885 .8548 .8227 .7921 .7629 .7350 .7084 .6830 5 .9515 .9283 .9057 .8616 .8219 .7835 .7473 .7130 .6806 .6499 .6209 6 .9420 .9145 .8880 .8375 .7903 .7462 .7050 .6663 .6302 .5963 .5645 7 .9327 .9010 .8706 .8131 .7599 .7107 .6651 .6227 .5835 .5470 .5132 8 .9235 .8877 .8535 .7894 .7307 .6768 .6274 .5820 .5403 .5019 .4665 9 .9143 .8746 .8368 .7664 .7026 .6446 .5919 .5439 .5002 .4604 .4241 10 .9053 .8617 .8203 .7441 .6756 .6139 .5584 .5083 .4632 .4224 .3855 11 .8963 .8489 .8043 .7224 .6496 .5847 .5268 .4751 .4289 .3875 .3505 12 .8874 .8364 .7885 .7014 .6246 .5568 .4970 .4440 .3971 .3555 .3186 13 .8787 .8240 .7730 .6810 .6006 .5303 .4688 .4150 .3677 .3262 .2897 14 .8700 .8119 .7579 .6611 .5775 .5051 .4423 .3878 .3405 .2992 .2633 15 .8613 .7999 .7430 .6419 .5553 .4810 .4173 .3624 .3152 .2745 .2394 16 .8528 .7880 .7284 .6232 .5339 .4581 .3936 .3387 .2919 .2519 .2176 17 .8444 .7764 .7142 .6050 .5134 .4363 .3714 .3166 .2703 .2311 .1978 18 .8360 .7649 .7002 .5874 .4936 .4155 .3503 .2959 .2502 .2120 .1799 19 .8277 .7536 .6864 .5703 .4746 .3957 .3305 .2765 .2317 .1945 .1635 20 .8195 .7425 .6730 .5537 .4564 .3769 .3118 .2584 .2145 .1784 .1486 21 .8114 .7315 .6598 .5375 .4388 .3589 .2942 .2415 .1987 .1637 .1351 22 .8034 .7207 .6468 .5219 .4220 .3418 .2775 .2257 .1839 .1502 .1228 23 .7954 .7100 .6342 .5067 .4057 .3256 .2618 .2109 .1703 .1378 .1117 24 .7876 .6995 .6217 .4919 .3901 .3101 .2470 .1971 .1577 .1264 .1015 25 .7798 .6892 .6095 .4716 .3751 .2953 .2330 .1842 .1460 .1160 .0923 26 .7720 .6790 .5976 .4637 .3607 .2812 .2198 .1722 .1352 .1064 .0839 27 .7644 .6690 .5859 .4502 .3468 .2678 .2074 .1609 .1252 .0976 .0763

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

ChapterA3: Time Value Of Money

Section: Chapter Questions

Problem 5CE

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Amount needed	$ 60,000.00
Length of time needed from today	4
Interest	12%
Compounded	Semiannually

Required:

Complete the following using the information above and the present value Table 12.3 or the present value table in the Business Math Handbook to answer the following:

Period used:
Rate used:
Factor used:
What must Tony deposit today so he will have $60,000 in 4 years?

Present value of $1 at end of period

Period	1%	1½%	2%	3%	4%	5%	6%	7%	8%	9%	10%
1	.9901	.9852	.9804	.9709	.9615	.9524	.9434	.9346	.9259	.9174	.9091
2	.9803	.9707	.9612	.9426	.9246	.9070	.8900	.8734	.8573	.8417	.8264
3	.9706	.9563	.9423	.9151	.8890	.8638	.8396	.8163	.7938	.7722	.7513
4	.9610	.9422	.9238	.8885	.8548	.8227	.7921	.7629	.7350	.7084	.6830
5	.9515	.9283	.9057	.8616	.8219	.7835	.7473	.7130	.6806	.6499	.6209
6	.9420	.9145	.8880	.8375	.7903	.7462	.7050	.6663	.6302	.5963	.5645
7	.9327	.9010	.8706	.8131	.7599	.7107	.6651	.6227	.5835	.5470	.5132
8	.9235	.8877	.8535	.7894	.7307	.6768	.6274	.5820	.5403	.5019	.4665
9	.9143	.8746	.8368	.7664	.7026	.6446	.5919	.5439	.5002	.4604	.4241
10	.9053	.8617	.8203	.7441	.6756	.6139	.5584	.5083	.4632	.4224	.3855
11	.8963	.8489	.8043	.7224	.6496	.5847	.5268	.4751	.4289	.3875	.3505
12	.8874	.8364	.7885	.7014	.6246	.5568	.4970	.4440	.3971	.3555	.3186
13	.8787	.8240	.7730	.6810	.6006	.5303	.4688	.4150	.3677	.3262	.2897
14	.8700	.8119	.7579	.6611	.5775	.5051	.4423	.3878	.3405	.2992	.2633
15	.8613	.7999	.7430	.6419	.5553	.4810	.4173	.3624	.3152	.2745	.2394
16	.8528	.7880	.7284	.6232	.5339	.4581	.3936	.3387	.2919	.2519	.2176
17	.8444	.7764	.7142	.6050	.5134	.4363	.3714	.3166	.2703	.2311	.1978
18	.8360	.7649	.7002	.5874	.4936	.4155	.3503	.2959	.2502	.2120	.1799
19	.8277	.7536	.6864	.5703	.4746	.3957	.3305	.2765	.2317	.1945	.1635
20	.8195	.7425	.6730	.5537	.4564	.3769	.3118	.2584	.2145	.1784	.1486
21	.8114	.7315	.6598	.5375	.4388	.3589	.2942	.2415	.1987	.1637	.1351
22	.8034	.7207	.6468	.5219	.4220	.3418	.2775	.2257	.1839	.1502	.1228
23	.7954	.7100	.6342	.5067	.4057	.3256	.2618	.2109	.1703	.1378	.1117
24	.7876	.6995	.6217	.4919	.3901	.3101	.2470	.1971	.1577	.1264	.1015
25	.7798	.6892	.6095	.4716	.3751	.2953	.2330	.1842	.1460	.1160	.0923
26	.7720	.6790	.5976	.4637	.3607	.2812	.2198	.1722	.1352	.1064	.0839
27	.7644	.6690	.5859	.4502	.3468	.2678	.2074	.1609	.1252	.0976	.0763

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