What amount will the company receive at the time the lease

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Q1. Sarasota Company recently signed a lease for a new office building, for a lease period of 10 years. Under the lease agreement, a security deposit of $14,720 is made, with the deposit to be returned at the expiration of the lease, with interest compounded at 5% per year. What amount will the company receive at the time the lease expires?

Q2. Ivanhoe Corporation, having recently issued a $20,062,200, 15-year bond issue, is committed to make annual sinking fund deposits of $620,000. The deposits are made on the last day of each year and yield a return of 10%. Will the fund at the end of 15 years be sufficient to retire the bonds? Future value of an ordinary annuity is & Will funds be sufficient?

Q3. Ivanhoe Corporation, having recently issued a $20,062,200, 15-year bond issue, is committed to make annual sinking fund deposits of $620,000. The deposits are made on the last day of each year and yield a return of 10%. Determine the amount of deficiency.

Q4. Under the terms of his salary agreement, president Henry Walters has an option of receiving either an immediate bonus of $77,000, or a deferred bonus of $98,000 payable in 10 years. Ignoring tax considerations and assuming a relevant interest rate of 4%, which form of settlement should Walters accept?

Reference no: EM133055714

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