What are the annual sinking fund payments

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Problem 1: Francesca, Inc. has issued a P10 million, 10-year bond issue. The bonds require Francesca to establish a sinking fund and make 10 equal, end-of-year deposits into the fund. These deposits will earn 8 percent annually, and the sinking fund should have enough accumulated in it at the end of 10 years to retire the bonds. What are the annual sinking fund payments?

A. 689,294

B. 690,295

C. 677,294

D. 689,342

 Problem 2: How long does it take for P856 to grow into P1,122 at an annual interest rate of 7%?

A. 2 years

B. 4 years

C. 3 years

D. 6 years

E. 30months

Reference no: EM132916671

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