Use the following 8% interest factors for questions . $\begin{array}{lll} &\text { Present Value of}&\text {Future Value of }\\&\text {Ordinary Annuity }&\text {Ordinary Annuity }\\ \hline 7 \text { periods } & 5.2064 & 8.92280 \\ 8 \text { periods } & 5.7466 & 10.63663 \\ 9 \text { periods } & 6.2469 & 12.48756 \end{array}$ -If $5,000 is deposited annually starting on January 1, 2007 and it earns 8%, what will the balance be on December 31, 2014?

A) $44,614 B) $48,183 C) $53,183 D) $57,438 A) $44,614 B) $48,183 C) $53,183 D) $57,438

On January 1, 2007, Grant Co.issued ten-year bonds with a face amount of $2,000,000 and a stated interest rate of 8% payable annually on January 1.The bonds were priced to yield 10%.Present value factors are as follows: $\begin{array}{lll}&\text { At 8\% } & \text { At 10\% }\\ \text { Present value of } 1 \text { for } 10 \text { periods } & 0.463 & 0.386 \\ \text { Present value of an ordinary annuity of } 1 \text { for } 10 \text { periods } & 6.710 & 6.145 \end{array}$ The total issue price of the bonds was

A) $2,000,000. B) $1,960,000. C) $1,840,000. D) $1,755,200. A) $2,000,000. B) $1,960,000. C) $1,840,000. D) $1,755,200.

Exam 6: Accounting and the Time Value of Money

Which table would you use to determine how much must be deposited now in order to provide for 5 annual withdrawals at the beginning of each year, starting one year hence?

(Multiple Choice)

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Question 61

If two annuities have the same number of rents with the same dollar amount, but one is an annuity due and one is an ordinary annuity, the present value of the annuity due will be greater than the present value of the ordinary annuity.

(True/False)

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Question 62

Use the following 8% interest factors for questions . Present Value of Future Value of Ordinary Annuity Ordinary Annuity 7 periods 5.2064 8.92280 8 periods 5.7466 10.63663 9 periods 6.2469 12.48756 -If $5,000 is deposited annually starting on January 1, 2007 and it earns 8%, what will the balance be on December 31, 2014?

(Multiple Choice)

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Question 63

On January 1, 2007, Grant Co.issued ten-year bonds with a face amount of $2,000,000 and a stated interest rate of 8% payable annually on January 1.The bonds were priced to yield 10%.Present value factors are as follows: At 8\% At 10\% Present value of 1 for 10 periods 0.463 0.386 Present value of an ordinary annuity of 1 for 10 periods 6.710 6.145 The total issue price of the bonds was

(Multiple Choice)

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Question 64

On May 1, 2007, a company purchased a new machine which it does not have to pay for until May 1, 2009.The total payment on May 1, 2009 will include both principal and interest.Assuming interest at a 10% rate, the cost of the machine would be the total payment multiplied by what time value of money factor?

(Multiple Choice)

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Question 65

Gorman Corporation makes an investment today (January 1, 2006).They will receive $20,000 every December 31st for the next six years (2006 - 2011).If Gorman wants to earn 12% on the investment, what is the most they should invest on January 1, 2006?

(Multiple Choice)

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Question 66

On January 1, 2007, Abel Co.exchanged equipment for a $160,000 noninterest-bearing note due on January 1, 2010.The prevailing rate of interest for a note of this type at January 1, 2007 was 10%.The present value of $1 at 10% for three periods is 0.75.What amount of interest revenue should be included in Abel's 2008 income statement?

(Multiple Choice)

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Question 67

Which of the following tables would show the largest value for an interest rate of 10% for 8 periods?

(Multiple Choice)

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Question 68

If a savings account pays interest at 4% compounded quarterly, then the amount of $1 left on deposit for 8 years would be found in a table using

(Multiple Choice)

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Question 69

Which of the following tables would show the smallest factor for an interest rate of 10% for six periods?

(Multiple Choice)

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Question 70

The future value of an annuity due factor is found by multiplying the future value of an ordinary annuity factor by 1 minus the interest rate.

(True/False)

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Question 71

Which of the following is true?

(Multiple Choice)

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Question 72

The figure .94232 is taken from the column marked 2% and the row marked three periods in a certain interest table.From what interest table is this figure taken?

(Multiple Choice)

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Question 73

At the end of two years, what will be the balance in a savings account paying 6% annually if $5,000 is deposited today? The future value of one at 6% for one period is 1.06.

(Multiple Choice)

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Question 74

What amount should an individual have in a bank account today before withdrawal if $5,000 is needed each year for four years with the first withdrawal to be made today and each subsequent withdrawal at one-year intervals? (The balance in the bank account should be zero after the fourth withdrawal.)

(Multiple Choice)

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Question 75

An accountant wishes to find the present value of an annuity of $1 payable at the beginning of each period at 10% for eight periods.The accountant has only one present value table which shows the present value of an annuity of $1 payable at the end of each period.To compute the present value, the accountant would use the present value factor in the 10% column for

(Multiple Choice)

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Question 76

Simple interest is computed on principal and on any interest earned that has not been withdrawn.

(True/False)

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Question 77

Present value of an Ordinary Annuity of 1. Multiple Choice-Computational

(Short Answer)

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Question 78

An amount is deposited for eight years at 8%.If compounding occurs quarterly, then the table value is found at

(Multiple Choice)

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Question 79

Which of the following transactions would require the use of the present value of an annuity due concept in order to calculate the present value of the asset obtained or liability owed at the date of incurrence?

(Multiple Choice)

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Question 80

Showing 61 - 80 of 90

Which table would you use to determine how much must be deposited now in order to provide for 5 annual withdrawals at the beginning of each year, starting one year hence?

If two annuities have the same number of rents with the same dollar amount, but one is an annuity due and one is an ordinary annuity, the present value of the annuity due will be greater than the present value of the ordinary annuity.

Gorman Corporation makes an investment today (January 1, 2006).They will receive $20,000 every December 31st for the next six years (2006 - 2011).If Gorman wants to earn 12% on the investment, what is the most they should invest on January 1, 2006?

Which of the following tables would show the largest value for an interest rate of 10% for 8 periods?

If a savings account pays interest at 4% compounded quarterly, then the amount of $1 left on deposit for 8 years would be found in a table using

Which of the following tables would show the smallest factor for an interest rate of 10% for six periods?

The future value of an annuity due factor is found by multiplying the future value of an ordinary annuity factor by 1 minus the interest rate.

Which of the following is true?

The figure .94232 is taken from the column marked 2% and the row marked three periods in a certain interest table.From what interest table is this figure taken?

At the end of two years, what will be the balance in a savings account paying 6% annually if $5,000 is deposited today? The future value of one at 6% for one period is 1.06.

What amount should an individual have in a bank account today before withdrawal if $5,000 is needed each year for four years with the first withdrawal to be made today and each subsequent withdrawal at one-year intervals? (The balance in the bank account should be zero after the fourth withdrawal.)

Simple interest is computed on principal and on any interest earned that has not been withdrawn.

Present value of an Ordinary Annuity of 1. Multiple Choice-Computational

An amount is deposited for eight years at 8%.If compounding occurs quarterly, then the table value is found at

Which of the following transactions would require the use of the present value of an annuity due concept in order to calculate the present value of the asset obtained or liability owed at the date of incurrence?

Financial Accounting and Accounting Standards

Conceptual Framework Underlying Financial Accounting

The Accounting Information System

Income Statement and Related Information

Balance Sheet and Statement of Cash Flows

Cash and Receivables

Valuation of Inventories: a Cost-Basis Approach

Inventories: Additional Valuation Issues

Acquisition and Disposition of Property, Plant, and Equipment

Depreciation, Impairments, and Depletion

Intangible Assets

Current Liabilities and Contingencies

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