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shtirl [24]
2 years ago
11

Ann Hopkins borrowed $60,000 for her child’s education. She must repay the loan at the end of 8 years in one payment with 512% i

nterest. What is the maturity value Ann must repay?
Business
1 answer:
mart [117]2 years ago
7 0

The Maturity Value that Ann must pay is $89,461.

Assuming the rate of interest is compounded annually.

Given,

Principal value = $60,000 = P

Rate of interest = 5.12% = i

Number of years = 8 = T

Since maturity value = Amount

Now, using the formula for calculating the amount,

Amount = P × {(1+i)^T}

Now, substituting the given values in the above formula for amount we get,

Amount = $60,000 × {(1+0.0512)^8}

             = $60,000 × {(1.0512)^8}

             = $60,000 × 1.49101776418

             = $89,461.0658

             = $89,461 (Approximately)

Hence, The Maturity Value that Ann must pay is $89,461.

Learn more about maturity value:

brainly.com/question/9099365

#SPJ1

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Complete the steps in the measurement of external transactions.
ZanzabumX [31]

Answer:

November 1 Issue common stock in exchange for $11,000 cash.

Dr Cash 11,000

    Cr Common stock 11,000

November 2 Purchase equipment with a long-term note for $1,500 from Spartan Corporation.

Dr Equipment 1,500

    Cr Notes payable 1,500

November 4 Purchase supplies for $1,100 on account.

Dr Supplies 1,100

    Cr Accounts payable 1,100

November 10 Provide services to customers on account for $7,000.

Dr Accounts receivable 7,000

    Cr Service revenue 7,000

November 15 Pay creditors on account, $1,200.

Dr Accounts payable 1,200

    Cr cash 1,200

November 20 Pay employees $1,000 for the first half of the month.

Dr Wages expense 1,000

    Cr cash 1,000

November 22 Provide services to customers for $9,000 cash.

Dr Cash 9,000

    Cr Service revenue 9,000

November 24 Pay $600 on the note from Spartan Corporation.

Dr Notes payable 600

    Cr Cash 600

November 26 Collect $5,000 on account from customers.

Dr Cash 5,000

    Cr Accounts receivable 5,000

November 28 Pay $1,200 to the local utility company for November gas and electricity.

Dr Utilities expense 1,200

    Cr Cash 1,200

November 30 Pay $3,000 rent for November.

Dr Rent expense 3,000

    Cr Cash 3,000

Cash                                               Common stock

debit               credit                      debit               credit

1,200                                                                      5,000

11,000                                             <u>                        11,000</u>

                      1,200                                               16,000

                      1,000

9,000

                      600

5,000

                      1,200

<u>                       3,000</u>

19,200

Accounts receivable                     Supplies

debit               credit                      debit               credit

400                                                500

7,000                                             <u>1,100                           </u>

<u>                        5,000</u>                     1,600

2,400

Equipment                                     Accounts Payable

debit               credit                      debit               credit

7,400                                                                     1,000

<u>1,500                         </u>                                             1,100

8,900                                             <u>1,200                        </u>

                                                                              900

Notes Payable                               Service revenue

debit               credit                      debit               credit

                      2,000                                              7,000

                      1,500                       <u>                        9,000</u>

<u>600                           </u>                                             16,000

                      2,900                     <u>6,000              closed</u>

Retained Earnings                        Wages expense

debit               credit                      debit               credit

                       1,500                      1,000

<u>                        10,800</u>                    <u>closed            1,000 </u>

                       12,300

Utilities expense                           Rent expense

debit               credit                      debit               credit

1,200                                              3,000

<u>closed            1,200 </u>                      <u>closed             3,000</u>

net income for the month = $16,000 - $5,200 = $10,800, so retained earnings should increase by $10,800

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