Accounting Homework Help

Updated on July 29, 2014
S.D. asks from Des Moines, IA
4 answers

Hey mammas :-)
Any accounting geniuses out there want to help me with a homework problem? I am by no means an accounting whiz and even though I've been working through this problem I'm still not sure I'm doing it right. So if you have absolutely nothing better to do on this Monday evening would you consider helping another momma out :-) I'll happily PM it to you or post in the SWH if that makes it easier. I'll include my calculations also so that it's easy to see where I'm going wrong. Thanks in advance!!

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So What Happened?

Wise words Julie S.! I figured out how to do the function in Excel & stopped stressing! I don't know how people do this kind of work all day!

1. Future Value and Annuity Payments Christy and Michael are trying to decide if they will have enough money to retire early in 15 years, at age 60. Their current assets are $250,000 in retirement plans and they have $100,000 in other investments. Together, they contribute $30,000 per year to their retirement plans and another $6,000 to other investments.

a. If their assets grow at 9 percent per year, how much money will they have when they turn 60? **the "n" is supposed to be to the power of - I just couldn't get it up high
FVA= A x ((1+i)n - 1)/i A 1+interest years
36,000 1.09 15
(1+i)n 3.64248246
(1+i)n – 1 2.64248246
(1+i)n - 1/i 29.###-###-####
###-###-####.984

FV = PV x (1+i)n PV 1+interest Year
350,000 1.09 15
3.64248246
###-###-####

1,274,869 + 1,056,992.98 = 2,331,861.98

b. After they retire, they will invest their wealth more conservatively and it will earn 6 percent per year. What will be the amount of their annual payments if they expect to live for 30 years in retirement?
How do I do this??

More Answers

J.S.

answers from St. Louis on

Save your sanity and plug it into excel. Look under formulas and financial.

I am an accountant but after a day of it the last thing I want to do is remember something I do not practice. When I need it, I use excel.

Look for present value of future cash flows, I think. I don't have excel on this machine for a reason.

Actually my work is so much harder than time value of money but I love it because it changes every day! If you have the ability add information technology management or management information systems or whatever they are calling it these D.. Basically business IT. I go between analyzing advising and forensics. Could not ask for a more challenging, and not boring, career!

5 moms found this helpful

M.D.

answers from Washington DC on

Julie S actually was a savior when I took accounting several years ago...she knows her stuff!

I also plugged the questions in to Google and sometimes came up with the same question or a similar one that would show me how to work it.

1 mom found this helpful
Smallavatar-fefd015f3e6a23a79637b7ec8e9ddaa6

M.O.

answers from Dallas on

Wouldn't you need to know how much they need to spend to live each year in retirement to answer question B?

Smallavatar-fefd015f3e6a23a79637b7ec8e9ddaa6

G.B.

answers from Oklahoma City on

My thoughts are Who Cares! They have enough income to put that kind of money into retirement? Any retirement plan their company has will at the very least keep them comfortable. If they add to it they'll be fine.

Also, if they pay on their house, get it down quickly then paid off they won't have high bills when they get older.

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