Your Federal Quarterly Tax Payments are due April 15th

# _1_. Complete the tables and answer the question. Just type in the by xiuliliaofz

VIEWS: 3 PAGES: 3

• pg 1
```									(1). Complete the tables and answer the question. Just type in the answers into the essay
box so far example (a) Table Factor X, Future Value \$ X

Present Value Rate Time Compount Frequency Table Factor Future Value

\$5,000         12% 2yrs.     Annual        2         1.2544        \$6,272

\$5,000         12% 2yrs. Semiannual        4         1.26248       \$6,312.4

\$5,000         12% 2yrs . Quaterly         8         1.26677       \$6,333.85

\$5,000         12% 2 yrs    Monthly      24         1.26973        \$6,348.65

(2). Cindy has decide to retire in 24 years. She has \$30,000 available today and wants to
invest the money to supplement her pension plan.

(b). Assune Cindy wants to accumulate \$150,000 by her retirement date. Will she achieve
her goal if she invests \$30,000 today and earn 6 percent? Show your calculation to support

FV = PV(1.06)24 = \$30,000(4.04893)=\$121,468

Answer : No,she won´t achieve \$150,000

(a). If Cindy invests a total of \$30,000 through a series of 24 equal annual installment at the
end of the year instead of a single amount, would Cindy accumulate the desire \$100,000 at
the 6 percent annual interest? The first first investment would be made one year from today.

Each payment is \$30,000/24=\$1250

Using table 2 factor value = 50.81558

So amount = \$1250(50.81558)=\$63,519.48

Answer: No, she will achieve less than 100,000
(3). Rusty Smith plans to choose one of three investments

(A) Pays \$2,500 at the end of each year for three years.

Investment (B) Pays \$8,500 at the end of five years.

Investment (C) Pays \$1,000 at the end of each years and pay \$4,000 at the end of the fifth
year.

Rusty requires a rate of 7 percent on each of these investments.

(a). What is the present value of investment A?

PV =                          = \$ 6,560.79

(b). What is the present value of investment B?

PV =         = \$ 6,060.38

(c). What is the present value of investment C?

PV =                                              =\$4,100.2

4. You have decide to purchase a boat. You have found a well-running boat that will cost
you \$29,500. You can finance your purchase through the dealer at an annual rate of 24
percent for 24 months. The dealer requires a down payment of \$8,000.

(a). What will be the amount of your monthly payment

From the factor table r = 0.24/12=0.02, n=24 then factor =18.91393

Initial amount= \$29,500 - \$8,000= \$ 21,500

Each payment = \$21,500/18.91393 = \$ 1136.728

(b). What will be the total amount paid to the dealer over the life of the loan.

\$ 8,000+24(\$ 1136.728)= \$ 35,281.47