Unformatted text preview: Future Value
-120,000 EXCEL OUTPUT
LO 6 S ME-4 Computing the present value of a future retirement obligation
Costco Corporation has agreed to pay employees who have worked for the
company more than 10 years a retirement bonus of $20,000 upon retirement. Rick
Jamison has worked for Costco for 15 years. Costco estimates that Rick will retire
in 7 years. If interest accrues quarterly and Costco can earn an annual return on
deposits of 3 percent, how much would Costco have to deposit today in order to
have exactly $20,000 to pay Rick at the end of 7 years?
0.03 / 4
0 Future Value
-20,000 EXCEL OUTPUT
16,224.39 Page 3 of 21 END-OF-CHAPTER MATERIAL LO 1 EXERCISES
S E-1 Recording rent expense
Amazon Corporation signed a 5-year operating lease to rent a distribution center
on January 1. Rent payments of $10,000 are due at the end of each month.
Prepare the journal entry to record the payment of cash for rent on January 31.
Rent expense (...
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This homework help was uploaded on 03/27/2014 for the course ACCOUNTING 151 taught by Professor Chinn during the Spring '12 term at Lehigh University .
- Spring '12