You Would Like to Give Your Child $100,000 to Start

question 37

Multiple Choice

You would like to give your child $100,000 to start a career 25 years from now. How much money must you set aside today for this purpose if you can earn 7.5 percent on your investments?

• A) $15,388.19
• B) $16,397.91
• C) $16,817.67
• D) $15,911.13
• E) $17,488.37

---

Definitions:

Accounting Equation

The foundation of double-entry bookkeeping, representing the relationship: Assets = Liabilities + Equity.

Debit-Credit Analysis

A fundamental accounting technique that balances debits and credits in financial transactions to maintain the equation of assets = liabilities + equity.

Credit Services

Financial services that provide customers with credit facilities to purchase goods or services, including loans, credit cards, and lines of credit.

GAAP

Generally Accepted Accounting Principles, a standard framework of guidelines for financial accounting used in any jurisdiction.