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kicyunya [14]
3 years ago
13

You plan to invest $600 in your savings account this year and then you intend to increase the amount that you invest by 3% each

year. If you invest in a savings account each that earns an effective annual interest rate of 7% how much money will you have in your account in 16 years?
Business
1 answer:
koban [17]3 years ago
7 0

Answer:

The correct answer is $20,211.84.

Explanation:

According to the scenario, the given data are as follows:

Payments (PMT) = $600

Interest rate = 7%

Growth rate = 3%

Time = 16 yeras

So, future value of growing annuity can be calculated by using following formula :

FV of growing annuity = Payment × ((1+ interest rate)^n - (1 + Growth rate)^n) / (Interest rate - Growth rate)

= 600 × ((1.07)^16 - 1.03^16) / (.07 - .03)

= 600 × ( 2.95216374857 - 1.6047064391 ) / (0.04)

= 600 × 33.6864

= $20,211.84

Hence, the correct answer is $20,211.84.

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The following data from the just completed year are taken from the accounting records of Mason Company: Sales $ 524,000 Direct l
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Answer:

Cost of Goods Available Sold $ 265,000

Adjusted Cost of Goods Sold  $ 255,000

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<u><em> Mason Company: </em></u>

<u><em>Cost Of Goods Schedule</em></u>

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Inventories  Ending Raw materials  $ 15,000

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<u>Cost Of Goods Schedule Adjusted </u>

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Raw material purchases $ 118,000

Inventories  Ending Raw materials  $ 15,000

Direct Materials Used $ 110,000

Direct labor cost $ 70,000

Manufacturing overhead applied to work in process $ 90,000

Total Manufacturing Costs $ 270,000

Add Work in process  Inventories Beginning  $ 10,000

Cost of Goods Available For Manufacture  $ 280,000

Less Work in process Inventories Ending $ 5,000

Cost of Goods  Manufactured $ 275,000

Add Finished goods  Inventories Beginning $ 20,000

Cost of Goods Available For Sale $ 295,000

Less Finished goods  Inventories Ending  $ 35,000

Cost of Goods Available Sold $ 265,000

Less Over Applied Overhead  $ 10,000

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Over applied overhead is deducted to get the actual Cost of Goods Sold.

<em><u>Mason Company: </u></em>

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Less

Adjusted Cost of Goods Sold  $ 255,000

Gross Profit        $ 269,000

Less Selling expenses $ 140,000

Administrative expenses $ 63,000

<u>Net Income             $ 66,000      </u>    

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