Cora Company will receive $10,000 a year for 5 years, with all receipts at the beginning of each year. What is the present value of this annuity using a 10% discount rate?
A)$35,000
B)$37,908
C)$40,000
D)$41,699

Question

Quizplus · Accepted Answer

The present value of an annuity due can be calculated using the formula for the present value of an annuity due. The present value of $10,000 received at the beginning of each year for 5 years at a 10% discount rate is $41,699.

Cora Company Will Receive $10,000 a Year for 5 Years