Question
In: Finance
A saver wants $100,000 after ten years and believes that it is possible to earn an...
A saver wants $100,000 after ten years and believes that it is possible to earn an annual rate of 8 percent on invested funds.
a) What amount must be invested each year to accumulate $100,000 if (1) the payments are made at the beginning of each year or (2) they are made at the end of each year?
b) How much must be invested annually if the expected yield is only 5 percent?
Please show step-by-step how to solve within excel
Solutions
Expert Solution
(a)
Annual payment required if payment at beginning of year is $6,391.61 and payment is $6,902.95 if payment is at end of each year. Lesser amount is payable for beginning of year payments because time value of money is higher for payments made at earliest.
(b)
Annual payments when interest rate is 5%:
Excel formulas are shown in the screenshot. Higher annual payments are due to lower interest rate in the second scenario.
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jeff jeffy answered 1 hour agoRelated Solutions
3. A saver wants $100,000 after ten years and believes that it is possible to earn...
3. A saver wants $100,000 after ten years and believes that it
is possible to earn an annual rate of 8 percent on invested
funds.
What amount must be invested each year to accumulate $100,000 if
(1) the payments are made at the beginning of each year or (2) they
are made at the end of each year?
How much must be invested annually if the expected yield is only
5 percent?
please explain step by step process.DO NOT COPY...
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Show this in excel with the formulas for excel shown. the
formulas must be shown
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Use a significance level of alpha=0.05 to test if women are now
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Equipment that is purchased for $12,000 now is expected
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6. The present worth is most nearly:
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Cornerstone Exercise 16.4 (Algorithmic) After-Tax Profit Targets Olivian Company wants to earn $600,000 in net (after-tax)...
Cornerstone Exercise 16.4 (Algorithmic)
After-Tax Profit Targets
Olivian Company wants to earn $600,000 in net (after-tax) income
next year. Its product is priced at $400 per unit. Product costs
include:
Direct materials
$120.00
Direct labor
$88.00
Variable overhead
$20.00
Total fixed factory overhead
$405,000
Variable selling expense is $16 per unit; fixed selling and
administrative expense totals $255,000. Olivian has a tax rate of
40 percent
Required:
1. Calculate the before-tax profit needed to
achieve an after-tax target of $600,000....
Cornerstone Exercise 16.4 (Algorithmic) After-Tax Profit Targets Olivian Company wants to earn $300,000 in net (after-tax)...
Cornerstone Exercise 16.4 (Algorithmic)
After-Tax Profit Targets
Olivian Company wants to earn $300,000 in net (after-tax) income
next year. Its product is priced at $300 per unit. Product costs
include:
Direct materials
$90.00
Direct labor
$66.00
Variable overhead
$15.00
Total fixed factory overhead
$420,000
Variable selling expense is $12 per unit; fixed selling and
administrative expense totals $270,000. Olivian has a tax rate of
40 percent.
Required:
1. Calculate the before-tax profit needed to
achieve an after-tax target of $300,000....
After-Tax Profit Targets Olivian Company wants to earn $300,000 in net (after-tax) income next year. Its...
After-Tax Profit Targets
Olivian Company wants to earn $300,000 in net (after-tax) income
next year. Its product is priced at $400 per unit. Product costs
include:
Direct materials
$120.00
Direct labor
$88.00
Variable overhead
$20.00
Total fixed factory overhead
$450,000
Variable selling expense is $16 per unit; fixed selling and
administrative expense totals $300,000. Olivian has a tax rate of
40 percent.
Required:
1. Calculate the before-tax profit needed to
achieve an after-tax target of $300,000.
$
2. Calculate the...
After-Tax Profit Targets Olivian Company wants to earn $300,000 in net (after-tax) income next year. Its...
After-Tax Profit
Targets Olivian Company wants to earn $300,000 in net
(after-tax) income next year. Its product is priced at $250 per
unit.
Product costs include:
Direct materials $75.00
Direct labor $55.00
Variable overhead $12.50
Total fixed factory overhead $445,000
Variable selling expense is $10 per unit; fixed selling and
administrative expense totals $295,000. Olivian has a tax rate of
40 percent.
Required: 1. Calculate the before-tax profit needed to achieve
an after-tax target of $300,000. $
2. Calculate the...
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