What Is the Future Value of the Following Cash Flows

question 17

Multiple Choice

What is the future value of the following cash flows at the end of year 3 if the interest rate is 6%? The cash flows occur at the end of each year.

• A) $15,916.78
• B) $18,109.08
• C) $18,246.25
• D) $19,341.02
• E) $19,608.07

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Definitions:

Net Income

The total earnings of a company after all expenses and taxes have been deducted from revenue.

Owner's Equity

The residual interest in the assets of an entity after deducting liabilities, representing the ownership interest in the company.

Owner's Drawings

The funds taken from the business by the owner for personal use, not considered as salary or wages.

Owner Drawings

Refers to the money or assets taken out of a business by the owner(s) for personal use.