Ischer Company Has Decided to Begin Accumulating a Fund for Plant

question 4

Essay

ischer Company has decided to begin accumulating a fund for plant expansion. The company deposited $20,000 in a fund on January 2, 2012. Fischer will also deposit $60,000 annually at the end of each year, starting in 2012. The fund pays interest at 5% compounded annually. What is the balance of the fund at the end of 2016 (after the 2016 deposit)?

---

Definitions:

Equipment Rental

The process of leasing machinery or equipment for a specific period instead of purchasing it outright.

Markup Per Unit

The sum added to the purchase price of products to account for operational costs and earnings.

Variable Cost

Expenses that change in proportion to the activity of a business.

Desired Profit

The target profit a company sets to achieve in a specific period.