Finance - Invest

3. CPA Exam - A businesswoman wants to invest a certain sum of money at the end of each year for 5 years. The investment will earn 6% compounded annually. At the end of 5 years, she will need a total of $30,000 accumulated. How should she compute the required annual investment? a) $30,000 times the amount of an annuity of $1 and 6% at the end of each year for 5 years b) $30,000 divided by the amount of an annuity of $1 at 6% at the end of each year for 5 years. c) $30,000 times the present value of an annuity of $1 at 6% at the end of each year for 5 years. d) $30,000 divided by the present value of an annuity of $1 at 6% at the end of each year for 5 years.

Finance - Investment

4. CPA Exam - Shaid Corporation issued $2,000,000 of 6%, 10-year convertible bonds on June 1, 1993 at 98 plus accrued interest. The bonds were dated April 1, 1993, with interest payable April 1 and October 1. Bond discount is amortized semiannually on a straight-line basis. On April 1, 1994, $500,000 of these bonds were converted into 500 shares of $20 par value common stock. Accrued interest was paid in cash at the time of conversion. What was the effective interest rate on the bonds when they were issued? a) 6% b) Above 6% c) Below 6% d) Cannot be determined from the information given.

Finite Math - Finance

1) CPA Exam - Which of the following should be used to calculate the amount of the equal periodic payments that could be equivalent to an outlay of $3000 at the time of the last payment? a) Amount of 1 b) Amount of an annuity of 1 c) Present value of an annuity of 1 d) Present value of 1 (Please provide operations or explain how you come up with answer/solution). Thank you,

Finite Math Used to Calculate amnt of equal periodic payments

1. Which of the following should be used to calculate the amount of the equal periodic payments that could be equivalent to an outlay of $3000 at the time of the last payment? a) Amount of 1 b) Amount of an annuity of 1 c) Present value of an annuity of 1 d) Present value of 1 (Please give reason for answer)

Finite Math Calculations

A husband and wife contribute $4,000 per year to an IRA paying 10%, compounded annually, for twenty years. What is the value of their IRA? How much can they withdraw each year for 25 years at 10% compounded annually? Please provide breakdown with solution. Thank you,