Howmet Corporation needs $200,000 in 5 years.
Find the required quarterly payment into a sinking fund if funds are invested in an account earning 10% per year compounded quarterly.
:) The formula of the future value of annuity ordinary is Fv=pmt [(1+r/k)^(kn)-1)÷(r/n)] So we need to solve for pmt Pmt=fv÷[(1+r/k)^(kn)-1)÷(r/n)] Pmt=200,000÷(((1+0.10÷4)^(4×5) −1)÷(0.10÷4))=7,829.43...answer
