In: Accounting
Annual contribution = 100000*12.4% = 12,400
FV of annuity | = | P * [ (1+r)^n -1 ]/ r | |
Periodic payment | P= | $ 12,400.00 | |
rate of interest per period | r= | ||
Rate of interest per year | 8.0000% | ||
Payment frequency | Once in 12 months | ||
Number of payments in a year | 1.00 | ||
rate of interest per period | 0.08*12/12 | 8.0000% | |
Number of periods | |||
Number of years | 40 | ||
Number of payments in a year | 1 | ||
Total number of periods | n= | 40 | |
FV of annuity | = | 12400* [ (1+0.08)^40 -1]/0.08 | |
FV of annuity | = | 3,212,300.83 |
Amount in 40 years is $3,212,300.83