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Ex 12-18 Present value of an annuity

Determine the present value of $200,000 to be received at the end of each of four years, using an interest rate of 7%, compounded annually, as follows:

a. By successive computations, using the present value table in Exhibit 8.

b. By using the present value table in Exhibit 10.

c. Why is the present value of the four $200,000 cash receipts less than the $800,000 to be received in the future?

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91893402

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