# Quiz for Accounting

Submitted By Allen1995
Words 1525
Pages 7
Chapter 4
1. Today, you turn 21. Your birthday wish is that you will be a millionaire by your 40th birthday. In an attempt to reach this goal, you decide to save \$25 a day, every day until you turn 40. You open an investment account and deposit your first \$25 today. What rate of return must you earn to achieve your goal?
A. 15.07%
B. 15.13%
C. 15.17%
D. 15.20%
E. 15.24%
2. Marko, Inc. is considering the purchase of ABC Co. Marko believes that ABC Co. can generate cash flows of \$5,000, \$9,000, and \$15,000 over the next three years, respectively. After that time, Marko feels ABC will be worthless. Marko has determined that a 14% rate of return is applicable to this potential purchase. What is Marko willing to pay today to buy ABC Co.?
A. \$19,201.76
B. \$21,435.74
C. \$23,457.96
D. \$27,808.17
E. \$29,808.17
3. You are considering two savings options. Both options offer a 4% rate of return. The first option is to save \$1,200, \$1,500, and \$2,000 a year over the next three years, respectively. The other option is to save one lump sum amount today. If you want to have the same balance in your savings at the end of the three years, regardless of the savings method you select, how much do you need to save today if you select the lump sum option?
A. \$4,318.67
B. \$4,491.42
C. \$4,551.78
D. \$4,607.23
E. \$4,857.92
4. You are considering a job offer. The job offers an annual salary of \$52,000, \$55,000, and \$60,000 a year for the next three years, respectively. The offer also includes a starting bonus of \$2,000 payable immediately. What is this offer worth to you today at a discount rate of 6%?
A. \$148,283.56
B. \$148,383.56
C. \$150,283.56
D. \$150,383.56
E. \$152,983.56
5. You have some property for sale and have received two offers. The first offer is for \$189,000 today in cash. The second offer is the payment of \$100,000 today and an additional \$100,000...

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