Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Assume Mr. Ram deposits Rs. 10,000 annually in a bank for 5 years, at 10 percent compound interest rate. Compute the value of this series of deposits on the end of five years by assuming that (i) all deposit occurs on the end of the year (ii) all deposit occurs at the starting of the year.
Solution:
The future value of regular annuity will be as:
Rs. 1000 (1.10)4 + 1000 (1.10)3 +1000 (1.10)2+1000 (1.10) +1000
= 6105.
The future value of an annuity due will be as:
Rs. 1000 (1.10)5 + 1000 (1.10)4 +1000 (1.10)3+1000 (1.10)2 +1000 (1.10)
= Rs 1000 (1.611) + 1000 (1.4641) + 1000 (1.331) + 1000 (1.21)+1000 (1.10)
= Rs. 6716.
In the above illustration you have seen the dissimilarity in future value of a regular annuity and annuity due. This diversity in value is because of the timing of cash flow. Within the case of regular annuity, the last cash flow doesn't earn any interest, for individual period the cash flows earns an interest and in case when annuity due.
During its financial year ended 30 June 20x7 Beavers Ltd, an engineering company, has worked on several contracts. Information relating to one of them is given below.
Red Lake Mines, Inc. is considering adoption of a new project requiring a net investment of $10 million. The project is expected to generate 5 years of net cash inflows of $5 milli
The following costs were incurred in 2010 in the design and construction of a new office building over a nine-month period during 2010: Requirement Calculate the amount
Q. What is Materiality? Materiality - Magnitude of an omission or misstatements of ACCOUNTING information that, in the light of surrounding circumstances, makes it probable tha
Q. Define about SME FINANCE? SMEs contribute in a significant way to many economies in the world. Moreover generating income, in often large proportions in relation to GNP acro
1. The average annual investment cost of a workstation in New Jersey has been calculated to be $100,000. It has been calculated to be $150,000 in Kentucky. The hourly cost at a
Let us assume you expect to obtain Rs.2000 yearly for the next three years. The receipt of Rs.2000 is evenly divided. One part that is: Rs.1000 is obtained at the beginning of the
Joe has two children, Sydney age 5 and William age 2, that he wants to provide for their education funding. Currently, tuition is $10,000 per year and tuition inflation is 6%. Jo
Firm Value: Old School Corporation expects an EBIT of $9,000 every year forever. Old School currently has no debt, and its cost of equity is 18 percent. The firm can borrow at
You have observed the following returns over time: Year Stock X Stock Y Market 2006 13% 13%
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd