Survey Of Accounting
5th Edition
ISBN: 9781259631122
Author: Edmonds, Thomas P.
Publisher: Mcgraw-hill Education,
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Textbook Question
Chapter 16, Problem 2E
Exercise 10-2A Determining the present value of a lump-sum future cash receipt
Larry Mattingly turned 20 years old today. His grandfather had established a trust fund that will pay him $120,000 on his next birthday. However, Larry needs money today to start his college education, and his father is willing to help. Mr. Mattingly has agreed to give Larry the present value of the $120,000 future
Required
Round your figures to the nearest whole dollar.
- a. Use a present value table to determine the amount of cash that Larry Mattingly’s father should give him.
- b. Use an algebraic formula to prove that the present value of the trust fund (the amount of cash computed in Requirement a) is equal to its $120,000 future value.
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Exercise 10-2A (Algo) Determining the present value of a lump-sum future cash receipt LO 10-1
Larry Mattingly turned 20 years old today His grandfather had established a trust fund that will pay him $85.000 on his next birthday
However Larry needs money today to start his college education, and his father is willing to help. M. Mattingly has agreed to give
Larry the present value of the $85.000 future cash inflow, assuming a 8 percent rate of return. EVofS1 and EVASD (Use
appropriate fector(s) from the tables previded.)
Required
. Determine the amount of cash that Lary Mattingly's father should give him. (Round your final answer to the nearest whole doller
value.)
Question 5 of 5
2 Points
Millet wants to provide a P200,000 graduation gift for her
daughter Mae who is now 16 years old. She would like the
fund to be available by the time she is 20 years of age. She
decides on an investment that pays 10% compounded
quarterly. How large must the deposit be?
Select the correct response:
Millet must deposit at least P136,000.00.
Millet must deposit at least P135,000.00.
Millet must deposit at least P138,000.00.
Millet must deposit at least P137,000.00.
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Accounting
Question 4.
Today is Mr. Wang's 30th birthday. He plans to
retire on his 65th birthday. Assuming that Mr.
Wang will deposit $20000 into the investment
account at the beginning of each month from
today, the account will earn an actual return of
4.9070208% every year in the first 15 years and
4.8% every year and interest every month in the
next 20 years.
The first contribution is paid today and the last
contribution is paid one month before the day of
retirement on your 65th birthday.
a) Try to find an account balance on your 65th
birthday
b) Try to calculate total interest earned
c) Try to calculate the total single interest
d) Try to calculate compound interest
Chapter 16 Solutions
Survey Of Accounting
Ch. 16 - Prob. 1QCh. 16 - Prob. 2QCh. 16 - Prob. 3QCh. 16 - 4. Define the term return on investment. How is...Ch. 16 - Prob. 5QCh. 16 - Prob. 6QCh. 16 - Prob. 7QCh. 16 - Prob. 8QCh. 16 - Prob. 9QCh. 16 - Prob. 10Q
Ch. 16 - 11. Maria Espinosa borrowed 15,000 from the bank...Ch. 16 - Prob. 12QCh. 16 - 13. What criteria determine whether a project is...Ch. 16 - Prob. 14QCh. 16 - Prob. 15QCh. 16 - Prob. 16QCh. 16 - 17. What is the relationship between desired rate...Ch. 16 - Prob. 18QCh. 16 - Prob. 19QCh. 16 - Prob. 20QCh. 16 - Prob. 21QCh. 16 - Prob. 22QCh. 16 - Prob. 23QCh. 16 - Exercise 10-1A Identifying cash inflows and...Ch. 16 - Exercise 10-2A Determining the present value of a...Ch. 16 - Prob. 3ECh. 16 - Prob. 4ECh. 16 - Exercise 10-5A Determining net present value...Ch. 16 - Exercise 10-6A Determining net present value Aaron...Ch. 16 - Exercise 10-7A Using the present value index Rolla...Ch. 16 - Exercise 10-8A Determining the cash flow annuity...Ch. 16 - Prob. 9ECh. 16 - Exercise 10-10A Using the internal rate of return...Ch. 16 - Prob. 11ECh. 16 - Prob. 12ECh. 16 - Exercise 10-13A Determining the payback period...Ch. 16 - Prob. 14ECh. 16 - Prob. 15ECh. 16 - Prob. 16PCh. 16 - Prob. 17PCh. 16 - Problem 10-18A Postaudit evaluation Brett Collins...Ch. 16 - Problem 10-19A Using net present value and...Ch. 16 - Problem 10-20A Using the payback period and...Ch. 16 - Problem 10-21A Using net present value and payback...Ch. 16 - Problem 10-22A Effects of straight-line versus...Ch. 16 - Problem 10-23A Comparing internal rate of return...Ch. 16 - Prob. 1ATCCh. 16 - ATC 10-4 Writing Assignment Limitations of capital...Ch. 16 - Prob. 5ATC
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