You need 8,000.00 four years from now for your future house..?

Question

You need 8,000.00 four years from now for your future house.. How much do you deposit today if your credit union pays 5% interest compounded annually?

6394.12

6581.62

6189.83

I figured it to be 6581.62...HELP

ANOTHER QUESTION

For a given accounting period, which is likely to be most directly related to the level of sales?

cost of goods sold

general and administrative expenses

depreciation expense

interest expense

Is it interest expense?

Answer 1

You are right, the answer is 6581.62.  Since there are only three choices, you just have to do trial and error for each multiplying each choice by 105% 4 times and whichever will give you 8000 is the correct answer which in this case is 6581.62.

Cost of goods sold or cost of sales are directly related to sales.  They are the costs that are directly identifiable to the products sold.  These are Materials, Labor and Overhead.