{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

ACC 210PAppendix3

# ACC 210PAppendix3 - \$20,000 annually at the end of each...

This preview shows pages 1–2. Sign up to view the full content.

ACC 210P Appendix 3 1. Joe Story deposited \$2,000 in an account paying interest of 5% compounded annually. What amount would be in the account at the end of 4 years? 2. Dross Company has decided to begin accumulating a fund for plant expansion. The company deposited \$10,000 in a fund on January 2, 2003. Dross will also deposit \$5,000 annually at the end of each year, starting in 2003. The fund pays interest at 5% compounded annually. What is the balance of the fund at the end of 2007 (after the 2007 deposit)? 3. (a) What is the present value of \$30,000 due 7 years from now, discounted at 8%? (b) What is the present value of \$50,000 due 5 years from now, discounted at 15%? 4. If Rachel Purcell invests \$14,962.50 now, she will receive \$50,000 at the end of 14 years. What annual rate of return will Rachel earn on her investment?

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
5. Raymond Company is considering investing in an annuity contract that will return
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: \$20,000 annually at the end of each year for 20 years. What amount should Raymond Company pay for this investment if it earns a 6% return? 6. Laurie Bassmore purchased an investment for \$9,818.15. From this investment, she will receive \$1,000 annually for the next 20 years starting one year from now. What rate of interest will Laurie be earning on her investment? 7. Purnell Company issued \$400,000, 10%, 2-year bonds that pay interest semi-annually. Compute the amount at which the bonds would sell if investors required a rate of return of 8%. 8. Torrie Company borrowed \$50,000 on January 2, 2007. This amount plus accrued interest of 5% compounded annually will be repaid at the end of 3 years. What amount will Torrie repay at the end of the third year?...
View Full Document

{[ snackBarMessage ]}

### Page1 / 2

ACC 210PAppendix3 - \$20,000 annually at the end of each...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document
Ask a homework question - tutors are online