Harlan Corporation Deposits $225,000 Every June 30th and December 31st

question 110

Multiple Choice

Harlan Corporation deposits $225,000 every June 30th and December 31st in a savings account (beginning in the current year) for the next three years so that it can purchase a new piece of machinery at the end of three years. The interest rate is 4%. How much money will Harlan Corporation have at the end of three years? Use the future value of an ordinary annuity factor table shown below to derive your answer.
$$\begin{array} { | c | c | c | c | c | } \hline \text { Periods } & \mathbf { 1 \% } & \mathbf { 2 } \% & \mathbf { 3 } \% & \mathbf { 4 } \% \\\hline 1 & 1 & 1 & 1 & 1 \\\hline 2 & 2.01000 & 2.02000 & 2.03000 & 2.04000 \\\hline 3 & 3.03010 & 3.06040 & 3.09090 & 3.12160 \\\hline 4 & 4.06040 & 4.12161 & 4.18363 & 4.24646 \\\hline 5 & 5.10101 & 5.20404 & 5.30914 & 5.41632 \\\hline 6 & 6.15202 & 6.30812 & 6.46841 & 6.63298 \\\hline 7 & 7.21354 & 7.43428 & 7.66246 & 7.89829 \\\hline 8 & 8.28567 & 8.58297 & 8.89234 & 9.21423 \\\hline 9 & 9.36853 & 9.75463 & 10.15911 & 10.58280 \\\hline 10 & 10.46221 & 10.94972 & 11.46388 & 12.00611 \\\hline\end{array}$$

• A) $1,419,327
• B) $688,590
• C) $1,492,421
• D) $702,360

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