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arks People Window Help S! 53% KI us Wed 8:44 PM Would you lke to translate it? Nope Translate Never translate Arabic Optionsx Return to Blackboard Intermediate Accounting. 16e Brief Exercise 6-5 Serena Medavoy wi ivet $6,650 a year for 16 years in a fund that will earn 11% annual interest. Click here to view factor tables in the fund in 16 years? (Round factor values to S decímal places, e.g. 1.25124 and final answers to o First payment today into the fund occurs today, what amount will be in the fund in 16 years? If the first payment occurs at year-end, what amount will be First payment at yearend s Question Attempts: 0 of 3 used SAvE FOR LATER

Explanation / Answer

Answer

A. First payment today is 289281(Approx), calculation below

FV = Payment x (1 + i) x ( (1 + i)^n - 1 ) / i

FV = $6650 x (1+0.11) x (1+0.11)^16 - 1 / 0.11

FV = $6650 x (1.11) x (1.11)^16 - 1 / 0.11

FV = $6650 x 1.11 x (5.31089433205 - 1) / 0.11

FV = $6650 x 1.11 x 4.31089433205 /0.11

FV = 289281(Approx)

B. First payment at year end is $260613(Approx), calculation below

FV = Payment x ( (1 + i)^n - 1 ) / i

FV = $6650 x ( (1+0.11)^16 - 1 /0.11

FV = $6650 x 4.31089433205 / 0.11

FV = $260613(Approx)

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