What is the minimum amount you need to have

Assignment Help Financial Accounting
Reference no: EM132961292

Question -

(a) You are going to pay off a car loan with payments of $500 every quarter for the first year and $1,000 every quarter during the second and third years. The return-guarantee investment account from which you make the loan repayments earns a quarterly rate of return of 4% and the first payment begins in three months.

(i) How much will the account balance increase three years from now if you do not have to make any of the repayments?

(ii) What is the minimum amount you need to have in the investment account today in order to make all the repayments?

(b) How much should you pay to buy an asset today that will pay you $5,000 every month, with the first payment eight months from now and the last payment 3 years from now? The relevant discount rate is 2% every month.

Reference no: EM132961292

Questions Cloud

Why training is important to the success of an organization : Identify three items that will help to develop new staff and explain the importance of each of the items.
Important obligations of government leaders : Did Scott Pruitt's misplaced and broken loyalties lead to his abuse of power and privilege or did his desire for power and privilege lead to his misplaced and b
What is the current tax expense of AA Company : The depreciation expense and rental income included in the 2021 tax return were higher by P90,000 and P45,000. What is the current tax expense of AA Company
Components of the c4 model : Research 'healthcare leaders' using the OCLS databases and locate an article of a leader that reflects the components of the C4 Model - conviction, convincing,
What is the minimum amount you need to have : What is the minimum amount you need to have in the investment account today in order to make all the repayments
Support leadership and management development : Provide at least five examples of how the L&D function can support leadership and management development
Introduction to human resource management : Question No 01 :- You are assigned a task by HR department to conduct a training for under performing employees in your regional offices. How you will plan and
Calculate the beginning inventory of finished goods : Calculate the beginning inventory of finished goods of the below case - Cost of goods manufactured during the period $970,000
Motivate companies to evaluate training programs : What can be done to motivate companies to evaluate training programs?

Reviews

Write a Review

Financial Accounting Questions & Answers

  Assuming the line intersects

The Salinas Corporation has gathered the following data on its copy machine costs for the first eight months of the year. Assuming the line intersects the y-axis at $3,500 and using the May activity levels what is the equation of the line that would ..

  Invested into the employees account

If an individual earning $50,000 per year has an opportunity to participate in an employee sponsored.How much per year will be invested into the employees account.

  Determine what would be the present value of the bond

Par value of P1,000; The coupon rate of 11%. If the required rate of return by investors were 14 % instead of 11%, what would be the present value of the bond?

  Prepare absorption and contribution margin income statements

Prepare absorption and contribution margin income statements for the succeeding quarter for the division and compute production costs per unit for both approaches and for both quarters

  Find the mean number of breaks

Find the mean number of breaks for the 15 coworkers, and round your answer to the nearest tenth.

  What is annualized holding period return

What is your annualized holding period return (annual percentage rate)? Round the answers to two decimal places in percentage form.

  What are the equivalent units of production for materials

The Assembly Department uses a process cost accounting system. The department adds materials and incurs conversion costs uniformly throughout the process. During May, $200,000 of materials costs and $95,000 in conversion costs were charged to the dep..

  What is the journal entry for the transaction

What is the journal entry for the transaction? Leased a delivery truck to YA right after purchasing it for $40,000 on December 31st, 2021.

  Determine waggoners maximum depreciation deduction

Waggoner would like to take the maximum depreciation deduction possible. Determine Waggoner’s maximum depreciation deduction for 2015.

  Should chen buy the new machine

Should Chen buy the new machine? Although the Chen Company's milling machine is old, it is still in relatively good working order

  Assuming monthly amortization of patents

Nieland Industries had one patent recorded on its books as of January 1, 2014. This patent had a book value of $409,200 and a remaining useful life of 10 years. During 2014, Nieland incurred research and development costs of $100,780 and brought a pa..

  What is the role of the anz bank

When it is first issued at a yield of 4.75% pa and sell it 30 days later to Prudential Investments at a yield of 4.55% pa. What is the role of the ANZ bank?

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