Assume That $400 Is Deposited at the End of Each

question 225

Multiple Choice

Assume that $400 is deposited at the end of each year into an account in which interest is compounded annually at a rate of 8.5%.Find the accumulated amount after 5 years.Round to the nearest cent.

• A)$2,384.60
• B)$2,399.05
• C)$2,370.15
• D)$2,330.25
• E)$2,351.80

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Definitions:

Interest Revenue

Earnings received from lending activities or from investments in interest-bearing assets.

Operating Lease

A lease agreement allowing a user to rent an asset without the benefits or responsibilities of ownership, typically with shorter lease terms.

Debt to Stockholders' Equity

A financial ratio that measures the company's financial leverage by comparing its total liabilities to stockholders' equity.

Capital Lease

A lease treated like a purchase by the lessee in accounting, meaning the leased asset is included on the balance sheet, and the corresponding lease obligation is treated as a liability.