Managerial Accounting: Tools for Business Decision Making
7th Edition
ISBN: 9781118334331
Author: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
Publisher: WILEY
expand_more
expand_more
format_list_bulleted
Question
Chapter A, Problem A.18BE
To determine
Present value: This is the amount of future value reduced or discounted at a rate of interest till particular current date.
Formula to compute present value:
To calculate: The annual interest rate on CM’s investment
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
If Oriole Mooney invests $1,560.48 now and she will receive $12,000 at the end of 18 years, what annual rate of interest will Oriole
earn on her investment? (Hint: Use Table 3.) (Round answer to O decimal places, e.g. 25%.)
Click here to view the factor table.
(For calculation purposes, use 5 decimal places as displayed in the factor table provided.)
Annual rate of interest
%
Sally enters into an investment that will guarantee her 5% year if she deposits $2045 each year for the next 10 years. She must make the first deposit one year from today. How much will she have when she makes her last payment 10 years from now? (Please use excel function = FV) to solve
12) What annual rate of return would Jia need to earn if she deposits $20,000 per year into an account beginning one year from today in order to have a total of $1,000,000 in 30 years?
Chapter A Solutions
Managerial Accounting: Tools for Business Decision Making
Ch. A - Prob. A.1BECh. A - Kor each of the following cases, indicate (a) what...Ch. A - Liam Company signed a lease for an office building...Ch. A - Prob. A.4BECh. A - Prob. A.5BECh. A - Prob. A.6BECh. A - For each of the following cases, indicate (a) what...Ch. A - Prob. A.8BECh. A - Prob. A.9BECh. A - Prob. A.10BE
Ch. A - Prob. A.11BECh. A - Prob. A.12BECh. A - Dempsey Railroad Co. is about to issue 400,000 of...Ch. A - Prob. A.14BECh. A - Neymar Taco Company receives a 75,000, 6-year note...Ch. A - Prob. A.16BECh. A - Frazier Company issues a 10%, 5-year mortgage note...Ch. A - Prob. A.18BECh. A - Prob. A.19BECh. A - Prob. A.20BECh. A - Prob. A.21BECh. A - Prob. A.22BECh. A - Prob. A.23BECh. A - Prob. A.24BECh. A - Prob. A.25BECh. A - As the purchaser of a new house, Carrie Underwood...Ch. A - Using a financial calculator, solve for the...Ch. A - Using a financial calculator, provide a solution...
Knowledge Booster
Similar questions
- Linda expects to receive P35,569.22 , 9 years from now. How much should she invests for three consecutive years (annually) starting THIS YEAR if the interest rate is 0.250? Use knowledge about ANNUITIES in solving thisarrow_forwardKen Francis is offered the possibility of investing $2,745 today; in return, he would receive $10,000 after 15 years. What is the annual rate of interest for this investment?arrow_forwardAssume Sheryl Jenkins wants to accumulate $12,241.30 in two years. She currently has $10,919.00 to invest. What interest rate must she earn on her investment (that is if she deposits $10,919.00 today) to have $12,241.30 exactly two years from today?arrow_forward
- Suppose that your friend has a farm in 2019 and wants to make an investment 150,000 in 2030 for all farm requirements. a) If you can earn 3.13% per year on your investments, how much does he need to invest today to achieve his goal? b) Between 2019 and 2025 how much would he have raised if the interest increased to 3.5%. c) From question A calculate the future value for year one and year two.arrow_forwardSaleh is considering an investment that will pay $5,000 a year for 7 years, starting one year from today. How much should she pay for this investment if she wishes to earn a 12 percent rate of return? a. $17,899.08 b. $18,023.88 c.. $20,186.75 d. $22,818.78arrow_forwardIf Kimberly Young invests $19472.93 now and she will receive $54000 at the end of 9 years, what annual rate of interest will she be earning on her investment? {:[11%],[10%],[10.5%],[12%]:}arrow_forward
- 3.) Mark decides to invest, if $300 is earned in three months on her investment of $12000 what is the anual rate of interest?arrow_forwardMick Mitchell wishes to have $120,000 in seven years. If he can earn annual interest of 12%, how much must he invest today? Click the icon to view Present Value of Ordinary Annuity of $1 table.) (Click the icon to view Future Value of Ordinary Annuity of S1 table.) (Click the icon to view Present Value of S1 table.) (Click the icon to view Future Value of S1 table.) OA. $265,320 В. $1,210 OC $54,240 OD. S111,960arrow_forwardK. Tanja wants to establish an account that will supplement her retirement income beginning 30 years from now. Find the lump sum she must deposit today so that $400,000 will be available at time of retirement, if the interest rate is 10%, compounded quarterly. How much must Tanja invest? P= (Round to the nearest cent as needed.)arrow_forward
- You believe you will need to have saved $593,000 by the time you retire in 30 years in order to live comfortably. You also believe that you will inherit $113,000 in 5 years. 1) If the interest rate is 7% per year, what is the future value of your inheritance at retirement? 2) How much additional money must you save to meet your retirement goal, assuming you save your entire inheritance?arrow_forwardCarla Willis will invest $26,000 today. She needs $52,317 in 12 years. What annual interest rate must she earn?arrow_forwardLeon would like to have a retirement income of $3,000 per month (beginning of month payments). How much must he have in his retirement fund on the day that he retires if he plans to live for 27 years? Assume that the account will earn j12=3.6%. Your Answer: Answerarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you