A Sinking Fund of $100 000 Is to Be Created

question 4

Essay

A sinking fund of $100 000 is to be created by equal annual payments at the beginning of each year for 12 years.Interest earned by the fund is 5.5% compounded annually.
a)Compute the annual deposit into the fund.
b)Construct a sinking fund schedule showing totals.

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Definitions:

Sensory Memory

The shortest-term element of memory, it allows the ability to retain impressions of sensory information after the original stimuli have ended.

Chunking

Chunking is a cognitive strategy for organizing information into manageable units or chunks, making it easier to process and remember.

7 Plus or Minus 2 Rule

A cognitive principle suggesting that the average person can hold 5 to 9 items in their working memory.

Quickly Scanning

Quickly scanning refers to rapidly reviewing or looking over material to grasp the main ideas or locate specific information.