You have entered into an agreement for the purchase of land. The agreement specifies that you will takeownership of the land immediately. You have agreed to pay $55,000 today and another $55,000 in threeyears. Calculate the total cost of the land today, assuming a discount rate of (a) 3 %, (b) 5%, or (c) 7%.Note: Use tables, Excel, or a financial calculator. Do not round your intermediate values. Round youranswers to 2 decimal places. (FV of $1. PV of $1. FVA of $1, and PVA of $1)Answer is complete but not entirely correct.CompoundingPeriodDuePayment InterestAmountTotal Cost ofRateLand Todaya.$ 55,0003%Annually3 yearsS155,573.62b.55,0005%Annually3 years238,121.22C.55,0007%Annually33yyears296.410.920

The objective of the question is to calculate the present value of the total cost of the land, given…

Answered: You have entered into an agreement for…

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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Liam needs to calculate the monthly payment for a loan to purchase the Charles Street property. Calculate the payment as follows: a) For the nper argument, use the Term_in_Months (cell D5) to specify the number of periods. b)For the pv argument, use the Loan_Amount (cell B8) to include the present value. c)Insert a negative sign (-) after the equal sign in the formula to display the result as a positive amount.
You take out an $19,000.00 car loan that calls for 48 monthly payments at an APR of 6.7%. Complete an amortization table and answer the following questions. You must complete the amortization table to answer the questions (otherwise your answers could be off due to rounding error... all totals are based on intermediate numbers that have not been rounded). The answer you enter must be rounded (correctly) to two decimal places. You do not need to include commas or dollar signs in your answer. For example, the end balance after 41 months would be entered as 3096.82. What is the total amount you paid on the loan?
You may use your financial calculator or excel for calculations but be sure to show your work (i.e. rate, periods, payments, etc.). For the amortization schedule be sure to print the schedule so all columns fit on one page and only include the first and last pages of the schedule when you pass it in. Jack Casey is interested in buying a waterfront vacation home and has saved $300,000 for the down payment. His plans call for making additional monthly deposits into an investment account over the next 12 months. Casey wants to make the purchase 18 months from today and wants to have $400,000 saved up for the down payment. What is the amount of each of the additional payments he must make for his plan to work out? Assume Allen can earn 2% annual return in his investment account. If Casey takes out a 30-year, $1,200,000 mortgage at 5%, what will his mortgage payments be? Prepare an amortization schedule to prove that your answer is right and his mortgage will be paid off in 30 years.
You take out an $19,000.00 car loan that calls for 48 monthly payments at an APR of 6.7%. Complete an amortization table and answer the following questions. You must complete the amortization table to answer the questions (otherwise your answers could be off due to rounding error... all totals are based on intermediate numbers that have not been rounded). The answer you enter must be rounded (correctly) to two decimal places. You do not need to include commas or dollar signs in your answer. For example, the end balance after 41 months would be entered as 3096.82. What is the total interest paid on the loan?
You purchase a $1,152,000 lake house and made a down-payment of $658,000. If you were to use the tvm solver to determine the monthy payment, what values would you enter for PV and FV?
For each of the following situations, identify (1) the case as either (a) a present or a future value and (b) asingle amount or an annuity, (2) the table you would use in your computations (but do not solve the problem),and (3) the interest rate and time periods you would use. A sweepstakes agency names you a grand prize winner. You can take $225,000 immediately or elect to receive annual installments of $30,000 for 20 years. You can earn 10% annually on any investments you make. Which prize do you choose to receive?
Find the annual homeowners insurance premium on a masonry home located in zone 1 if the home is insured for $237,000. The owner chooses a $1,500 deductible and has good credit. E Click the icon to see a hypothetical table of Estimated Annual Homeowners Insurance Premium Rates per $100 of Face Value. The annual homeowners insurance premium is $ (Simplify your answer. Type an integer or a decimal.)
PLEASE, PERFORM THE EXERCISE IN EXCEL AND SHOW THE FORMULASProblem 1:Domingo Medina wants to know the amount of the quarterly rent, for which he would have to exchange a total lump sum payment of $750,000.00, with the condition that it be paid to him or his heirs for 12 years. If the finance company operates at 8¼% interest, find the value of the quarterly rent. Note:In the image, this is the original exercise, it is in Spanish, but it is easy to understand. Very important Note:It is necessary that you make a solution approach and then the result. Above all, to check the procedure and/or the formulas used, especially when you use excel.
You are assiting a newly hired employee. You begin explaning the process of utilizing excel to finance properties. Consider the following. A realator has a house on sale for $640,000. If possible you believe you can finance the home for $300,000 for 20 years at a 3% interest rate. What would the monthly principle and interest payment be for the acquird loan? Calculate using the PV funtion in excel. How would you caluclate this in Excel using the PV function? Rate: Nper: Pmt: FV: Type:
All the remaining questions are based on the following scenario: You take out an $19,000.00 car loan that calls for 48 monthly payments at an APR of 6.7%. Complete an amortization table and answer the following questions. You must complete the amortization table to answer the questions (otherwise your answers could be off due to rounding error... all totals are based on intermediate numbers that have not been rounded). The answer you enter must be rounded (correctly) to two decimal places. You do not need to include commas or dollar signs in your answer. For example, the end balance after 41 months would be entered as 3096.82 What is your loan payment?
You want to investigate whether it will make financial sense for your business to purchase some real estate. Find a commercial property that is for sale in your area that your business could use (purchase price must be at least $20,000). Include the URL that will take the class to the webpage for the property. You will finance 80% of the purchase price; you will put 20% down on the purchase. Using 5% as the interest on your 30-year fixed rate mortgage, calculate the monthly payment. Next, calculate the payment using the same 5%, but for a 15-year mortgage. Show all steps in your calculations in your post. In a summary paragraph, discuss the results of your calculations and what you think is the best decision for your business to make regarding purchasing the property. Include these items in your post: URL link to property Calculation of 30-year monthly payment Calculation of 15-year monthly payment Steps in calculations Summary
Assume that you are about to sell property (a vacant parcel of real estate) you own but otherwise have no use for. The net-of-sales- commission selling price for the property is $450,000. You are willing to finance this transaction over a 14-year period and have told the buyer that you expect a 11% pretax return on the transaction. The buyer has asked you for a payment schedule under several alternatives. Required: 1. What will be your periodic cash receipt, to earn a 11% return, if payments are received from the purchaser: NOTE: to answer the above questions, use the PMT function in Excel, as follows: PMT(rate,nper, pv,fv,type) where: rate is the interest rate for the loan, nper is the total number of payments, pv is the present value (i.e., the total amount that a series of future payments is worth now; also known as the principal), fv is the future value (or a cash balance you want to attain after the last payment is made; if fv is omitted, it is assumed to be 0 (zero)), and type is…

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