Derek will deposit $9,359.00 per year for 18.00 years into an account that earns 4.00%, The first deposit is made next year. He has $18,418.00 in his account today. How much will be in the account 49.00 years from today

Answers

Answer 1

Answer:

FV= $904,322.05

Explanation:

First, we will calculate the future value of the 18 deposits 19 years from now. Also the value of the $18,418 19 years from now.

FV= {A*[(1+i)^n-1]}/i

A= annual deposit= 9,359

n= 18

i= 0.04

FV= {9,359*[(1.04^18) - 1]} / 0.04

FV= $240,015.42

FV= PV*(1+i)^n

FV= 18,418*(1.04^19)

FV= $38,803.95

Total FV= 240,015.42 + 38,803.95= $278,819.37

Finally, the value of the account for the remaining 30 years:

FV= 278,819.37*(1.04^30)

FV= $904,322.05


Related Questions

At the beginning of the year, Cann Co. started construction on a new $2 million addition to its plant. Total construction expenditures made during the year were $200,000 on January 2, $600,000 on May 1, and $300,000 on December 1. On January 2, the company borrowed $500,000 for the construction at 12%. The only other outstanding debt the company had was a 10% interest rate, long-term mortgage of $800,000, which had been outstanding the entire year. What amount of interest should Cann capitalize as part of the cost of the plant addition

Answers

Answer:

$72,500

Explanation:

The computation of the amount of interest capitalized is as follows:

= ($500,000 × 12%) + ($625,000 - $500,000) × 10%

= $60,000 + $12,500

= $72,500

The Average expenditure for the year  is

= ($200,000 × 12 ÷ 12) +  ($600,000 × 8 ÷ 12)  + ($300,000 × 1 ÷ 12)

= $200,000  + $400,000  + $25,000

= $625,000

A motel had the following business on a particular week. Number Occupied Type of room Sun Mon Tues Wed Thu Fri Sat Rate per night Nightly 60 60 60 60 60 $80 5-day Week 90 90 90 90 90 $64 7-day Week 50 50 50 50 50 50 50 $48 Weekend only 130 130 $56 If there are 200 rooms and the operating costs are $20,000 plus a cleaning fee of $5 per room per day, compute the profit during the one-week period. Group of answer choices $57,360 $57,059 $64,160 $64,160

Answers

Answer:

Total profit for week = $57360

Explanation:

To calculate the profit for one-week period, we first need to calculate the revenue for one week period based on the given occupancy.

We will first calculate the revenue for every day and add it to calculate the revenue for the week.

Sunday = 60 * 80  +  90 * 64  +  50 * 48  => $12960

Monday = 60 * 80  +  90 * 64  +  50 * 48  => $12960

Tuesday = 60 * 80  +  90 * 64  +  50 * 48  => $12960

Wednesday = 60 * 80  +  90 * 64  +  50 * 48  => $12960

Thursday = 60 * 80  +  90 * 64  +  50 * 48  => $12960

Friday = 50 * 48  +  130 * 56  => $9680

Saturday = 50 * 48  +  130 * 56  => $9680

Total revenue for one week = 12960 * 5 + 9680 * 2  => $84160

To calculate the profit, we will first calculate the total cost.

Total cost = 20000 + (5 * 200 * 5 + 5 * 180 * 2)

Total cost = $26800

Total profit for week = 84160 - 26800

Total profit for week = $57360

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