2) Mayer Company signed a lease for an office building for a period of 10 years.

Question

2) Mayer Company signed a lease for an office building for a period of 10 years. Under the lease agreement, a security deposit of $7,200 is made. The deposit will be returned at the expiration of the lease with interest compounded at 8% per year.(use the factot table) (For calculation purposes, use 5 decimal places as displayed in the factor table provided.) What amount will Mayer receive at the time the lease expires? (Round answer to 2 decimal places, e.g. 25.25.)

3)Ekman Company issued $1,100,000, 11-year bonds and agreed to make annual sinking fund deposits of $71,500. The deposits are made at the end of each year into an account paying 6% annual interest. Click here to view the factor table.a (For calculation purposes, use 5 decimal places as displayed in the factor table provided.) What amount will be in the sinking fund at the end of 11 years? (Round answer to 2 decimal places, e.g. 25.25.)

4)Terry and Jessica Benedict invested $6,300 in a savings account paying 8% annual interest when their daughter, Kristi, was born. They also deposited $1,400 on each of her birthdays until she was 15 (including her 15th birthday). Click here to view the factor table. (For calculation purposes, use 5 decimal places as displayed in the factor table provided.) How much was in the savings account on her 15th birthday $ (after the last deposit)? (Round answer to 2 decimal places, e.g. 25.25.)

5) Click here to view the factor table. (For calculation purposes, use 5 decimal places as displayed in the factor table provided.) (a) What is the present value of $25,600 due 10 periods from now, discounted at 10%? (Round answer to 2 decimal places, e.g. 25.25.) Present value $ (b) What is the present value of $25,600 to be received at the end of each of 7 periods, discounted at 6%? (Round answer to 2 decimal places, e.g. 25.25.)

6) Elmdale Company is considering an investment that will return a lump sum of $725,500, 6 years from now. Click here to view the factor table. (For calculation purposes, use 5 decimal places as displayed in the factor table provided.) What amount should Elmdale Company pay for this investment to earn a 12% return? (Round answer to 2 decimal places, e.g. 25.25.) Elmdale Company should pay

7) Orear Company earns 6% on an investment that will return $491,500, 8 years from now. Click here to view the factor table. (For calculation purposes, use 5 decimal places as displayed in the factor table provided.) What is the amount Orear should invest now to earn this rate of return? (Round answer to 2 decimal places, e.g. 25.25.) Orear Company should invest

8) Dayton Company is considering investing in an annuity contract that will return $34,300 annually at the end of each year for 19 years. Click here to view the factor table. (For calculation purposes, use 5 decimal places as displayed in the factor table provided.) What amount should Dayton Company pay for this investment if it earns a 9% return?

9) Nolasko Enterprises earns 12% on an investment that pays back $90,100 at the end of each of the next 7 years. Click here to view the factor table. (For calculation purposes, use 5 decimal places as displayed in the factor table provided.) What is the amount Nolasko Enterprises invested to earn the 12% rate of return? (Round answer to 2 decimal places, e.g. 25.25.)

10) Brief Exercise D-15 Robertson Company receives a $75,700, 8-year note bearing interest of 10% (paid annually) from a customer at a time when the discount rate is 10%. Click here to view the factor table. (For calculation purposes, use 5 decimal places as displayed in the factor table provided.) What is the present value of the note received by Robertson? (Round answer to 2 decimal places, e.g. 25.25.) Present value of note received

Explanation / Answer

2) security deposit 7200 (FVIF)(8%,10yrs) 2.15890 amount Mayer will receive          15,544.08 3) Annual sinking fund deposit 71500 (FVAF) (6%,11yrs) 14.97164 amt in sinking fund account    1,070,472.26 4) Annual investment 6300 FVIF(8%.15yrs) 3.17217 Return          19,984.67 Annual investment 1400 (FVAF) (8%,15yrs) 27.15211 return          38,012.95 Amt in savings account on her 15th birthday          57,997.63 (19984.671+38012.95) 5) Amount 25600 PVIF(10%,10yrs) 0.38554 Present value of amount 9869.824 Amount 25600 PVIF(6%,7yrs) 0.66505 Present value of amount 17025.28 6) Amount expected 725,500 FVIF(6 yrs, 12%) 1.97382 Amount to be invested    367,561.38

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