Question

In: Accounting

A company invested Rs. 1000 each year for the first 5 years. Then the amount decreased...

A company invested Rs. 1000 each year for the first 5 years. Then the amount decreased by Rs.
50 each year for the next 4 years. Find the future value at the end of cashflow if interest rate is
10%/year

Solutions

Expert Solution

Year Cash inflow (outflow) Table Factor Present Value of Cash Flows Cumulative present value of cash flows
1 -1000 0.91 -909.09 -909.09
2 -1000 0.83 -826.45 -1,735.54
3 -1000 0.75 -751.31 -2,486.85
4 -1000 0.68 -683.01 -3,169.87
5 -1000 0.62 -620.92 -3,790.79
6 -950 0.56 -536.25 -4,327.04
7 -900 0.51 -461.84 -4,788.88
8 -850 0.47 -396.53 -5,185.41
9 -800 0.42 -339.28 -5,524.69
Present Value -5,525.00
Future Value -13,027.66 "=-5,525*(1.1)^9"

Related Solutions

If​ $1000 is deposited at the end of each year for 5 years into an ordinary...
If​ $1000 is deposited at the end of each year for 5 years into an ordinary annuity earning 7.59​% compounded​ annually, construct a balance sheet showing the interest earned during each year and the balance at the end of each year. Complete the balance sheet. Period Amount Interest Balance 1 ​$1000.00 ​ ​ 2 ​$1000.00 ​ ​ 3 ​$1000.00 ​ ​ 4 ​$1000.00 ​ ​ 5 ​$1000.00 ​ ​ ​(Round to the nearest cent as​ needed.)
Payments of $1000 are invested into an account at the end of each year for 8...
Payments of $1000 are invested into an account at the end of each year for 8 years, earning 8% effective per annum. Interests can only be reinvested at 6% for the first 6 years and 7% thereafter. Find the accumulated value of the investment after 10 years. (Answer: $12092.96)
A bond with a face value of Rs. 1000 matures in 10 years. if the market...
A bond with a face value of Rs. 1000 matures in 10 years. if the market rate (YTM) is at 12% and the price of the bond is 990, what is the annual coupon rate for the bond?
At the end of each year for the first 5 years, Cecil and Norma DeMille plan...
At the end of each year for the first 5 years, Cecil and Norma DeMille plan to contribute $1,000 to their daughter Sally's college fund. For the next 5 years they will contribute $2,000 at the end of each year, and then increase that amount to $3,000 until she turns 18 and is ready for college. What amount will they have accumulated for Sally's college fund if the account pays 6.35% annually? Please be very thorough with work and provide...
You invested $1000 in a stock portfolio 3 years ago.  You contributed another $1000 1 year ago.  The...
You invested $1000 in a stock portfolio 3 years ago.  You contributed another $1000 1 year ago.  The current value of the portfolio is $4000.  What is the rate of return (internal rate of return) of this investment?
$1,000 is invested at 5%p.a compounding semi-annually for the first 3 years and at 11% p.a...
$1,000 is invested at 5%p.a compounding semi-annually for the first 3 years and at 11% p.a compounding quarterly for the following 5 years. What is the future value at the end of 8 years? (round to nearest dollar; don't include $ sign or commas)
Find the amount of each of 5 payments made at the end of each year into...
Find the amount of each of 5 payments made at the end of each year into a 6% rate sinking fund which produces $21,000 at the end of 5 years. A. $2,053.18 B. $3,514.46 C. $3,725.32 D. $4,200.00
Find the present value of $1000 paid at the end of each month for 5 years...
Find the present value of $1000 paid at the end of each month for 5 years at 12% compounded semi-annually If possible, please use in terms of a financial calculator
I invested $15,000 at the end of each year for 20 years, earning an average of...
I invested $15,000 at the end of each year for 20 years, earning an average of 8% per year, then $20,000 at the end of each year for the next 20 years earning an average of 4 percent per year. I then contacted Annuity Corp. which offers annuities to retirees. If I receive an annual interest rate of 2.5%, how much could I receive at the end of each of the following 20 years if I invested my retirement savings?
A 50-year annuity with an annual interest rate of 8%. In the first 20 years, $1000...
A 50-year annuity with an annual interest rate of 8%. In the first 20 years, $1000 was deposited at the beginning of each year, and in the next 30 years, $1400 was deposited at the beginning of each year. Calculate the value of this annuity at the end of the 40th year.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT