Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. on january 1, boston company completed the followi

On January 1, Boston Company completed the following transactions (use a 7% annual interest rate...

70.2K

Verified Solution

Question

Accounting

On January 1, Boston Company completed the following transactions (use a 7% annual interest rate for all transactions):

a)Borrowed $116,600 for seven years. Will pay $6,800 interest at the end of each year and repay the $116,600 at the end of the 7th year.

In transaction (a), determine the present value of the debt. ( Round to the nearest dollar)

I used my financial Calculator to evaluate the annuity payments to get the Present value of 36,647.1679 and then evaluated the payment at the end of the 7th year to get PV of 72,238.9701, which totals 108,886 But I am being told this is incorrect. I don't understand what I am doing wrong.

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Zin AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Q

Hello, please 200 words at least, thank you: Q: There are several accepted methods of determining...

Finance
Q

Discuss the various databases available in the GCU library. Which ones have you used before? What...

Psychology
Q

Capital Budgeting Risk Analysis Project Instruction Create the pro forma income statement and estimate the cash...

Accounting
Q

5 A plane electromagnetic wave propagating in the x direction has wavelength of 6 0...

Physics
Q

x x A B C Which statements when combined describe a sequence of transformations that...

Algebra
Q

The Edsel 5600 computer can process the payroll for Kentucky College in 9 hours The...

Algebra
Q

If a sample of a certain solution is determined to have a a H3O concentration...

Algebra
Q

Simplify the expression Assume all variables are positive X 13 1 5 X X

Algebra
Q

Coronado Corporation is considering...

Accounting
Q

Tongkat Ali Sdn Bhd makes 1000 litres of a chemical C for use in its...

Accounting
Q

Bramble Company uses a flexible budget for manufacturing overhead based on direct labor hours. Variable...

Accounting
Q

Assume you are now a mortgage broker and you are either working as an independent...

Finance