Financial Accounting > EXAM > ACCT 211 Appendix B Question and Answers (All)

ACCT 211 Appendix B Question and Answers

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Exercise B-1 Present value of an amount P1 Mike Derr Company expects to earn 10% per year on an investment that will pay $606,773 six years from now. Use Table B.1 to compute the present value of th... is investment. (Round the amount to the nearest dollar.) Exercise B-2 Present value of an amount P1 On January 1, 2015, a company agrees to pay $20,000 in three years. If the annual interest rate is 10%, determine how much cash the company can borrow with this agreement. Exercise B-3 Number of periods of an investment P2 Tom Thompson expects to invest $10,000 at 12% and, at the end of a certain period, receive $96,463. How many years will it be before Thompson receives the payment? Exercise B-4 Interest rate on an investment P2 Bill Padley expects to invest $10,000 for 25 years, after which he wants to receive $108,347. What rate of interest must Padley earn? Exercise B-5 Future value of an amount P2 Mark Welsch deposits $7,200 in an account that earns interest at an annual rate of 8%, compounded quarterly. The $7,200 plus earned interest must remain in the account 10 years before it can be withdrawn. How much money will be in the account at the end of 10 years? Exercise B-6 Future value of an amount P2 Catten, Inc., invests $163,170 today earning 7% per year for nine years. Use Table B.2 to compute the future value of the investment nine years from now. (Round the amount to the nearest dollar.) [Show More]

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