70.2K

Verified Solution

Link Copied!

1. Mike Derr Company expects to earn 6% per year on an investment that will pay $606,000 nine years from now. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round "Table Factor" to 4 decimal places.) Compute the present value of this investment.

Future Value x Table Factor = Present Value

2. On January 1, a company agrees to pay $14,000 in seven years. If the annual interest rate is 7%, determine how much cash the company can borrow with this agreement. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round "Table Factor" to 4 decimal places.)

	Future Value Present Value Table Factor Interest Rate = %

3. Tom Thompson expects to invest $9,000 at 12% and, at the end of a certain period, receive $39,272. How many years will it be before Thompson receives the payment? (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round "Table Factor" to 4 decimal places.)

	Future Value Present Value Table Factor years =

4. Bill Padley expects to invest $19,000 for 3 years, after which he wants to receive $21,373.10. What rate of interest must Padley earn? (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round "Table Factor" to 4 decimal places.)

Future Value Present Value Table Factor Interest Rate

5. Mark Welsch deposits $8,100 in an account that earns interest at an annual rate of 8%, compounded quarterly. The $8,100 plus earned interest must remain in the account 2 years before it can be withdrawn. How much money will be in the account at the end of 2 years? (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round "Table Factor" to 4 decimal places.)

	Present Value Table Factor Total Accumulation =

Spiller Corporation plans to issue 10%, 9-year, $480,000 par value bonds payable that pay interest semiannually on June 30 and December 31. The bonds are dated January 1 of the current year and are issued on that date. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round your "Table value" to 4 decimal places and final answers to nearest whole dollar.) If the market rate of interest for the bonds is 8% on the date of issue, what will be the total cash proceeds from the bond issue?

	Table Values are Based on: n = i = Cash Flow Table Value Amount Present Value Present (maturity) value Interest (annuity) Total cash proceeds

Answer & Explanation Solved by verified expert

See Answer