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: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Basic Math
1.2K views

2. Using your answers from question 1, determine the following confidence intervals for the population standard...

Chemistry
1.2K views

1) 1. How many ATOMS of sulfur are present in 4.30 moles of sulfur dioxide ? atoms of...

Psychology
1.2K views

Why did Japan lose the Second World War?

General Management
1.2K views

Business start-up Describe how the company developing marketing strategies, marketing plan, collecting information and forecasting demand for...

Geometry
1.2K views

10 If0 e 90 and cos 9 25 A B 6 6

Basic Math
1.2K views

2 Determine the final balance of each investment a 275 is invested at 6 2...

Calculus
1.2K views

An investment of $45,000 earns 6% annual interest and is compounded semiannually. If no funds...

Calculus
1.2K views

The temperature over a given period is Estimate the average temperature from 0 t 8...

Algebra
1.2K views

Move the slider k so that the graph of y 2 gets shifted up 2...

Accounting
1.2K views

Blossom Import Company purchased a depreciable asset for $164000 on April 1, 2020. The estimated...

Accounting
1.2K views

Open T-accounts using the balances in the unadjusted trial balance. Prepare the adjusting...

Accounting
1.2K views

A company uses an MACRS 5-year method to depreciate its equipment. There is no salvage...