A Deposit of $ 5000 Is Made in an Account $A _ { n } = 5000 \left( 1 + \frac { 0.04 } { 4 } \right) ^ { n } , n = 1,2,3 , \ldots$

question 365

Multiple Choice

A deposit of $ 5000 is made in an account that earns 4 % interest compounded quarterly.The balance in the account after n quarters is given by $A _ { n } = 5000 \left( 1 + \frac { 0.04 } { 4 } \right) ^ { n } , n = 1,2,3 , \ldots$ Find the balance in the account after 10 years by finding the 40th term of the sequence.Round to the nearest penny.

• A)$ 7518.76.
• B)$ 7370.61
• C)$ 7444.32
• D)$ 7518.76
• E)$ 24,005.10

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Definitions:

Specific Identification Method

An inventory costing method that tracks the actual cost of each specific item in inventory until it is sold.

Equity Method

An accounting technique used for recording investments in associate companies where the investment is initially recognized at cost and adjusted thereafter for the post-acquisition change in the investor’s share of the investee’s net assets.

Journal Entries

The method by which all business transactions are recorded in a company's accounting system, using debits and credits.

Other Comprehensive Income

Portions of total comprehensive income of a company not realized in net income, including items like foreign currency translation adjustments or unrealized gains on securities.