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Alisiya [41]
3 years ago
8

Problem 5.3 Your birthday is coming up and instead of other presents, your parents promised to give you $2,600 in cash. Since yo

u have a part-time job and, thus, don’t need the cash immediately, you decide to invest the money in a bank CD that pays an annual rate of 9.80 percent, compounded quarterly, for the next two years. How much money can you expect to earn in this period of time? (If you solve this problem with algebra round intermediate calculations to 4 decimal places, in all cases round your final answer to the nearest penny.) Value of investment after 2 years $
Business
1 answer:
Papessa [141]3 years ago
8 0

Answer:

Ans. The value of investment after 2 years is $3,155.51

Explanation:

Hi, first we need toconvert that 9.80 percent, compounded quarterly into an effective quarterly rate, that is just by dividing by 4, since there are 4 quarters in a year, that is:

r(effective quarterly)= 9.8%/4 =2.45%

Now, since the rate is effective quarterly, the periods (time of the invesmet) has to be in quarters, so we multiply 2 years by 4 and we get 8 quarters.

With all the above information, we can go ahead and use the following formula in order to find the future value of this investment.

FutureValue=PresentValue*(1+r)^{n}

It should all look like this.

FutureValue=2,600*(1+0.0245)^{8}=3,155.51

So, the future value of this investment is $3,155.51

Best of luck.

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anzhelika [568]

Answer:

The Journal entries are as follows:

(a) On January 1, 2020

Cash A/c(6,000 bonds × $102) Dr. $612,000

         To Bonds payable                                  $600,000

         To premium on bonds payable             $12,000

(To record the issuance of the bonds)

Workings:

premium on bonds payable = $612,000 - $600,000

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(b) On July 1, 2020

Interest expense A/c                  Dr. $29,700

Premium on bonds payable A/c Dr. $300

        To cash A/c                                            $30,000

(To record the interest expense)

Workings:

Cash = $600,000 × (6/12) × 10%

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Premium on bonds payable = $12,000 ÷ 40 periods

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(c) On December 31, 2020

Interest expense A/c                  Dr. $29,700

Premium on bonds payable A/c Dr. $300

        To Interest payable A/c                            $30,000

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2 years ago
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blondinia [14]

The correct answer to the given statement that "A service and physical good are similar in terms of uniformity of inputs" is:

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This refers to the physical item which has value and can be bought and sold in a market place.

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Read more about goods and services here:

brainly.com/question/25262030

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siniylev [52]

Answer:

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pashok25 [27]
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james is a wells fargo employee. his manager saw him parking illegally in the loading zone once, so he assumes james must have e
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Perception of the people is altered once we start to compare things to one another.

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