Exercise 6B-16 X Your answer is incorrect. Try again Tony Fowler borrowed $94,02

Question

Exercise 6B-16 X Your answer is incorrect. Try again Tony Fowler borrowed $94,020 on March 1, 2015. This amount plus accrued interest at 10% compounded Semiannually is to berePaid Mach , 2025. To retire this debt, Tony plans to contribute to a debt retirement fund five equal amounts starting on March 1, 2020, and for the next 4 years. The fund is expected to earn 9% per annum. Click here to view factor tables How much must be contributed each year by Tony Fowler to provide a fund sufficient to retire the debt on March 1, 2025? (Round factor values to 5 decimal places, e.g. 1.25124 and final answer to O decimal places, e.g. 458,583.) Annual contribution to debt retirement fund 31580 LINK TO TEXT

Explanation / Answer

Futue value=94020*FVFn,i(20,5%) *2.65330 249463 Future value of ordinary annuity of 1 of 5 period at 8% 5.98471 multiplied *1.06 Future Value of annuity due of 1 for 5 period at 6% 6.34379 Future value of an annuity due= Rent * 6.34379 Rent=249463/6.34379 39324.0 Ans annual contribution=39324

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