Find the Amount of an Ordinary Annuity for 6 Years

question 14

Multiple Choice

Find the amount of an ordinary annuity for 6 years of semiannually payments of $1,400 that earn interest at 8%/year compounded semi-annually. ​

• A) $2,241.45
• B) $21,036.13
• C) $26,567.98
• D) $9,286.17

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Definitions:

Cash Disbursements

The outflow of cash for business expenses, acquisitions, or investments, documented within a specific period.

Raw Material Purchases

The acquisition of the basic substances or components that are used in the manufacturing process to produce finished goods.

Budgeted Sales

The forecasted sales for a specific period, serving as a key component of financial and operational planning.

Credit Sales

Transactions where goods or services are provided to a customer with the agreement that payment will be made at a later date.