Find the Future Value at the End of Year 3

question 83

Multiple Choice

Find the future value at the end of year 3 of the following stream of cash flows received at the end of each year, assuming the firm can earn 8 percent on its investments.

• A) $45,000
• B) $53,396
• C) $47,940
• D) $56,690

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Definitions:

Generally Accepted Accounting Principles

A collection of commonly-followed accounting rules and standards for financial reporting.

Financial Statement Formats

The specific layout and organization of information within financial documents, such as balance sheets and income statements, which comply with accounting standards.

Cash Flow Statement

A financial document that shows the amount of money a business has on hand at the beginning of a time period, receipts coming into the business, and money going out of the business during the same period.

Income Statement

A financial statement that reports a company's financial performance over a specific accounting period, detailing revenues, expenses, and profits.