Accounting: What the Numbers Mean 11th Edition by Wayne McManus,Daniel Viele,David Marshall

Exercise 32

Present value calculations Using a present value table, your calculator, or a computer program present value function, calculate the present value of:
a. A car down payment of $9,000 that will be required in two years, assuming an interest rate of 10%.
b. A lottery prize of $18 million to be paid at the rate of $900,000 per year for 20 years, assuming an interest rate of 10%.
c. The same annual amount as in part b , but assuming an interest rate of 14%.
d. A capital lease obligation that calls for the payment of $24,000 per year for 10 years, assuming a discount rate of 8%.