Date: Class: Name: Financial Accounting ACCL Professor Horowitz-Test 4 - Fall 20

Question

Date: Class: Name: Financial Accounting ACCL Professor Horowitz-Test 4 - Fall 2017 4 Using the following table, what is the present value of$40,000 to be received in 5 years, if the market rate is 7% compounded annually? 7% 0.93458 0.87344 0.81630 0.76290 0.71299 0.66634 0.62275 0.58201 0.54393 0.50835 10% 0.90909 0.82645 0.75132 0.68301 5% 0.95238 0.90703 0.86384 0.82270 0.78353 0.74622 0.71068 0.67684 0.64461 0.61391 6% 0.94340 0.89000 0.83962 0.79209 0.74726 0.70496 0.66506 0.62741 0.59190 0.55840 ods 0.56447 0.51316 0.46651 0.42410 0.38554

Explanation / Answer

Amount to be received in 5 years, Future Value = $40000

Period, n = 5 years

Market Rate, i = 7%

Present Value = Future Value * PVIF (i,n)

= $40000 * PVIF (7%,5)

= $40000 * 0.71299

= $28519.60

Present Value = $28520

Related Questions

Navigate

• Browse (All)
• Browse D
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.