Use the following 8% interest factors for questions . $\begin{array}{lll}
&\text { Present Value of}&\text {Future Value of }\&\text {Ordinary Annuity }&\text {Ordinary Annuity }\
\hline 7 \text { periods } & 5.2064 & 8.92280 \
8 \text { periods } & 5.7466 & 10.63663 \
9 \text { periods } & 6.2469 & 12.48756
\end{array}$
-Henson Company wishes to accumulate $300,000 by May 1, 2015 by making 8 equal annual deposits beginning May 1, 2007 to a fund paying 8% interest compounded annually.What is the required amount of each deposit?
A)$52,205
B)$28,204
C)$26,115
D)$30,234

Question

Use the following 8% interest factors for questions . $\begin{array}{lll}
&\text { Present Value of}&\text {Future Value of  }\&\text {Ordinary Annuity }&\text {Ordinary Annuity }\
\hline 7 \text { periods } & 5.2064 & 8.92280 \
8 \text { periods } & 5.7466 & 10.63663 \
9 \text { periods } & 6.2469 & 12.48756
\end{array}$
-Henson Company wishes to accumulate $300,000 by May 1, 2015 by making 8 equal annual deposits beginning May 1, 2007 to a fund paying 8% interest compounded annually.What is the required amount of each deposit?
A)$52,205
B)$28,204
C)$26,115
D)$30,234

Quizplus · Accepted Answer

The future value of an ordinary annuity factor for 8 periods at 8% is 10.63663. To find the required deposit, divide the future value goal ($300,000) by this factor: $300,000 / 10.63663 = $28,204.

Use the Following 8% Interest Factors for Questions -Henson Company Wishes to Accumulate $300,000 by May 1, 2015