Document on Accounting Finance

Running head: ACCOUNTING & FINANCE
Accounting & Finance
Name of the University
Name of the student
Authors note

1ACCOUNTING & FINANCE
Table of Contents
Answer to Question 1:................................................................................................................2
Requirement a:.......................................................................................................................2
Requirement b:.......................................................................................................................2
Requirement c:.......................................................................................................................3
Requirement d:.......................................................................................................................3
Requirement e:.......................................................................................................................3
Answer to Question 2:................................................................................................................4
Requirement 1:.......................................................................................................................4
Requirement 2:.......................................................................................................................5
Answer to Question 3:................................................................................................................6
Requirement i:........................................................................................................................6
Requirement ii:.......................................................................................................................7
Requirement iii:......................................................................................................................9
Requirement iv:......................................................................................................................9
Requirement v:.....................................................................................................................10
Requirement v:.....................................................................................................................10
Requirement vi:....................................................................................................................11
Requirement vii:...................................................................................................................11
Requirement viii:..................................................................................................................11
Reference:................................................................................................................................12

2ACCOUNTING & FINANCE
Answer to Question 1:
Requirement a:
Requirement b:
Particulars
Amoun
t
Total Value of Lottery A
$200,00
0
Initial Withdraw B $20,000
Investment Value C=A-B
$180,0
00
Rate of Interest p.a. D 10%
Deferred Period (in
years) E 4
Future Investment
Value after 4 years F=Cx(1+D)^E
$263,5
38
Monthly Rate of
Interest G=D/12 0.83%
Nos. of Monthly
Payments H 180
Size of Equal
Payments
I=(GxF)/[1-
(1+G)^-H] $2,832
Requirement c:
Particulars
Amoun
t
Annual Deposit A $4,000
Interest Rate p.a. B 5%
Nos. of Deposits C 11
Particulars
Amoun
t
Total Fund Desired A $10,000
Periodic Payments B $800
Interest Rate p.a. C 10%
Nos. of Payments p.a. D 2
Compound Interest E=C/D 5.00%
Total nos. of
Payments
F=NPER(E,B,0
,(-A)) 9.95
Nos. of Full
Payments G=F-0.95 9
Size of Concluding
Payment H=Bx(F-G) $760

3ACCOUNTING & FINANCE
Total Deposit
Amount in 2017
D=(1+B)xA[{(
1+B)^C-1}/B]
$59,66
9
Requirement d:
It would be ideal not to sale off at the present time period, as this would result to a
loss and this has been explained in the underlying table:
Particulars
Amoun
t
Annual Payment A $20,000
Interest Rate p.a. B 6%
Nos. of Deposits C 10
Present Value of the
Total Payments
D=(1+B)xA[{1
-(1+B)^-C}/B]
$156,0
34
Current Sale Price of
Future Rights E
$150,00
0
Loss on Sales F=E-D
($6,034
)
Requirement e:
Period
Growth in
Annual
Payments
Annual
Annuit
y
Disco
unt
Rate
Discounte
d Annuity
A B C D
E=C/
((1+D)^A)
1 0% $1,000 12% $893
2 10% $1,100 12% $877
3 10% $1,210 12% $861
4 10% $1,331 12% $846
5 10% $1,464 12% $831
6 10% $1,611 12% $816
7 10% $1,772 12% $801
8 10% $1,949 12% $787
9 10% $2,144 12% $773