Intelligent and informed financial planner

Assignment Help Financial Accounting
Reference no: EM131803497

You plan to save $7,000 each of the next 40 years, and invest that money in an account that pays 9% annual interest. In addition, you plan to pay for your child's college education beginning in 20 years. You expect that education to cost $30,000 per year for four years. To pay for the education, you will simply withdrawal money from your investment account. In addition, you currently have an outstanding loan with a balance of $15,000 and an annual interest rate of 9%. You plan to pay off that loan over the next few years. A timeline depicting this situation follows.

Date

0

1-19

20-23

24-40

Deposits


$7,000

$7,000

$7,000

Withdrawals



$30,000


Loan Balance

$15,000




a) How much money will you have just after you make your last deposit forty years from today?

b) How much money will you have 5 years later (year 45) if you make no additional deposits or withdrawals?

c) As an intelligent and informed financial planner, you have been asked to evaluate the assumptions and analysis above. What specific flaws do you see (if any)

Reference no: EM131803497

Questions Cloud

What is the purchasing power of those annual withdrawals : What is the purchasing power of those annual withdrawals in today's dollars?
Developing an investment plan for a new client : As an investment advisor, you are developing an investment plan for a new client.
Accounts appeared in two of its trial balances : The Wiley Department Store is located near the Village shopping mall. At the close of the year ended December 31, 2007, the following accounts appeared.
Reconstruct the equity statement : What was the average price at which the company originally sold its stock? Reconstruct the equity statement above to reflect a four-for-one stock split.
Intelligent and informed financial planner : As an intelligent and informed financial planner, you have been asked to evaluate the assumptions and analysis above. What specific flaws do you see (if any)
Weighted average cost of capital : Standex Products has estimated that its after-tax cost of debt is 6% and its cost of common equity is 16%. Standex expects to continue a policy of borrowing.
Find the conversion price of a convertible : Find the conversion price of a convertible $1,000 bond, convertible into common stock at $20.00 per share. The market price of the common stock is $18.00
Find the conversion price for a convertible : Find the conversion price for a convertible $1,000 bond with a conversion ratio of 15. The market price of the common stock is $47.00 per share.
Half debt and half common equity : A firm has a capital structure that is half debt and half common equity and totals $120,000,000.

Reviews

Write a Review

Financial Accounting Questions & Answers

  Financial statement analysis and preparation

Financial Statement Analysis and Preparation

  Shareholder of a company

Describe the ways that a person can become a shareholder of a company. Why Wal-Mart would split its stock?

  Financial and accounting principles

An understanding of financial and accounting principles can be a valuable tool for managers. While not all managers will find themselves calculating financial ratios or preparing annual financial data.

  Prepare a statement of cash flow using the direct method

Prepare a Statement of Cash Flow using the Direct Method and Prepare the Operations section of the Statement of Cash Flow using the Indirect Method.

  Financial accounting assignment

This assignment has one case study and two question apart from case study. Questions related to document Liquidation question and Company financial statements question - Torquay Limited

  Prepare general journal entries for goela

Prepare general journal entries for Goela Ltd

  Principles of financial accounting

Prepare the journal entry to record the acquisition of the assets.

  Prepare general journal entries to record the transactions

Prepare general journal entries to record the transactions, assuming use of the periodic inventory system

  Global reporting initiative

Compare the view espoused by the economist Milton Friedman about the social responsibilities of business with the views express by Stigler.

  Explain the iasb conceptual frameworks

Explain the IASB Conceptual Framework's perspective of users and their decisions.

  Determine the company''s financial statements

T he focus of the report is to determine the extent to which you are comfortable relying on the financial statements as presented by management .

  Computation of free cash flow

Computation of Free Cash Flow

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd