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会计代写-221H1S
时间：2022-02-16
Faculty of Arts and Science
and
Rotman School of Management
RSM 221H1S – Intermediate Financial Accounting II
SAMPLE EXAM
with solution
This sample exam is a modified version of the on the Feb 15, 2017 in-person Mid-term Exam
Section # 101 – C.BARRETTE
Duration: 1 hour and 50 minutes
------------------------------------------------------------------------------------------------------------------------------
Grade
MC Questions /18
Question 1 /14
Question 2 /18
Question 3 /9
Question 4 /11
Total : /70
Multiple Choice Questions : 18 marks------------------------------------------------------------------------------------
The midterm exam might include a set of multiple choice questions. The format of these questions is
similar to the WileyPlus quizzes.
Question 1 – Long Term Debt – 14 marks
i) 9 marks - Based on the information above, prepare the journal entries for March 1st, 2016,
September 1st, 2016 and December 31st, 2016. Indy reports under IFRS and must use the
effective interest rate method to amortize any premiums or discount.
March 1st, 2016 (2 marks)
Cash ………………………………………………………………. $2,074,859
Bond Payable……………………………………………………….$2,074,859
September 1st, 2016 (4 marks)
Interest Expense……………………………..$31,123
Bond Payable………………………………….$8,877
Cash……………………………………………………………….40,000
Date Cash Paid
Interest
Expense
Premium
Amortization
Carrying
Amount of
Bond
Interest
rate
March 1st, 2016 2,074,859$ 1.50%
Sept 1st, 2016 40,000$ 31,123$ 8,877$ 2,065,982$ 1.50%
March 1st, 2017 40,000$ 30,990$ 9,010$ 2,056,972$ 1.50%
Sept 1st, 2017 40,000$ 30,855$ 9,145$ 2,047,826$ 1.50%
March 1st, 2018 40,000$ 30,717$ 9,283$ 2,038,544$ 1.50%
Sept 1st, 2018 40,000$ 30,578$ 9,422$ 2,029,122$ 1.50%
March 1st, 2019 40,000$ 30,437$ 9,563$ 2,019,559$ 1.50%
Sept 1st, 2019 40,000$ 30,293$ 9,707$ 2,009,852$ 1.50%
March 1st, 2020 40,000$ 30,148$ 9,852$ 2,000,000$ 1.50%
December 31st, 2016 (3 marks)
Interest Expense……………………………$20,660
Bond Payable…………………………………$6,007
Interest Payable…………………………………………$26,667
Note: If a template is provided in your exam, you must use the template to
answer the question.
Situation B – 5 marks
Marigold Corp issued bonds payable on January 1st, 2016. The bonds have a face value of $25,000,000,
a coupon rate of 6% and the interest is payable annually on the anniversary date of the bonds. When
the bonds payable were issued, the market rate was 6.25% which resulted in the bond being sold at a
discount.
The amortization table for the bonds payable that was prepared on January 1st, 2016 when the bonds
were issued is shown below:
On January 2nd, 2021, Marigold Corp decided to repay the loan early as they had excess cash on hand.
The imperial Bank allowed them to cancel the loan for the equivalent of the market value of the loan on
January 2nd, 2021. The market rate on January 2021 was 5%.
Required: Compute the market value of the loan on January 2nd, 2021 and prepare a journal entry to
record the early settlement of the bonds payable. (hint: The market value of the loan can be
computed by finding the PV of the bonds payable with similar terms under the current market rate
conditions).
Date Cash Paid
Interest
Expense
Premium
Amortization
Carrying
Amount of
Bond
Interest
rate
January 1st, 2016 24,545,394$ 6.25%
January 1st, 2017 1,500,000$ 1,534,087$ 34,087$ 24,579,481$ 6.25%
January 1st, 2018 1,500,000$ 1,536,218$ 36,218$ 24,615,699$ 6.25%
January 1st, 2019 1,500,000$ 1,538,481$ 38,481$ 24,654,180$ 6.25%
January 1st, 2020 1,500,000$ 1,540,886$ 40,886$ 24,695,067$ 6.25%
January 1st, 2021 1,500,000$ 1,543,442$ 43,442$ 24,738,508$ 6.25%
January 1st, 2022 1,500,000$ 1,546,157$ 46,157$ 24,784,665$ 6.25%
January 1st, 2023 1,500,000$ 1,549,042$ 49,042$ 24,833,706$ 6.25%
January 1st, 2024 1,500,000$ 1,552,107$ 52,107$ 24,885,813$ 6.25%
January 1st, 2025 1,500,000$ 1,555,363$ 55,363$ 24,941,176$ 6.25%
January 1st, 2026 1,500,000$ 1,558,824$ 58,824$ 25,000,000$ 6.25%
PV factor
from tables.
PV of the principal Amount 25000000 0.78353 $ 19,588,250
PV of ordinary annuity 1500000 4.32948 $ 6,494,220
$ 26,082,470
Variables used: Nper=5, Rate = 5%,
Bond Payable 24,738,508
Loss on early redemption of bond 1,343,962
Cash 26,082,470
Question 2 – Percentage of Completion Method – 18 marks
Jia Consulting is currently developing a new customized accounting system for Rio Wholesales Canada.
Jia consulting started the project in November of 2015 and completed the project half way into 2017.
A fixed price of $17,000,000 was negotiated between Jia and Rio as the compensation for this project.
The table below shows a summary of costs and expected costs for each of the 3 years of the project.
Jia Consulting reports under IFRS and has a year end of December 31st.
2015 2016 2017
Costs to date $ 3,800,000 $10,750,000 $16,400,000
Estimated costs to
complete
$11,200,000 $5,750,000 0
Estimated total costs $15,000,000 $16,500,000 $16,400,000
Progress Billing
during the year
$5,000,000 $5,000,000 $7,000,000
Part I (15 marks) – Required : Based on the information provided above, prepare the journal entries
at December 31st, 2015, 2016 and 2017 for Jia Consulting to account for the Rio Wholesale Project.
DECEMBER 31st, 2015
Journal Entry
Contract Asset / Liability $3,800,000
Materials, Payables, Cash…. $3,800,000
* To record the cost of construction
Accounts Receivables $5,000,000
Contract Asset Liability $5,000,000
* To record the progress billing made during the year
Contract Asset Liability $4,306,100
Revenues from Long Term Contract $4,306,100
* To record the revenues for the year
Construction Expenses $3,800,000
Contract Asset / Liability $3,800,000
To record the construction expense for the year.
Support Computations:
Costs to date = 3,800,000
Total Costs = 15,000,000
% complete = 25.33%
25.33% * 17,000,000 = $4,306,100
DECEMBER 31st, 2016
Journal Entry
Contract Asset / Liability $6,950,000
Materials, Payables, Cash…. $6,950,000
* To record the cost of construction
Accounts Receivables $5,000,000
Contract Asset Liability $5,000,000
* To record the progress billing made during the year
Contract Asset Liability $6,769,657
Revenues from Long Term Contract $6,769,657
* To record the revenues for the year
Construction Expenses $6,950,000
Contract Asset / Liability $6,950,000
To record the construction expense for the year.
Support Computations:
Costs to date = 10,750,000
Total Costs = 16,500,000
% complete = 65.15%
65.15 * 17,000,000 = 11,075,757
Revenue to be recognized in the current year: 11,075,757 – 4,306,100 = 6,769,657
DECEMBER 31st, 2017
Journal Entry
Contract Asset / Liability $,5,650,000
Materials, Payables, Cash…. $5,650,000
* To record the cost of construction
Accounts Receivables $7,000,000
Contract Asset Liability $7,000,000
* To record the progress billing made during the year
Contract Asset Liability $5,924,243
Revenues from Long Term Contract $5,924,243
* To record the revenues for the year
Construction Expenses $5,650,000
Contract Asset / Liability $5,650,000
To record the construction expense for the year.
Support Computations
Costs to date = 16,400,000
Total Costs = 16,400,000
% complete = 100%
Revenue to be recognized in the current year: 17,000,000 – 11,075,757 = $5,924,243
Part II (3 marks)
Emma was the project manager for the Rio Wholesale project. She comes to see you, the VP Finance of
Jia, and asks you for a performance bonus with regards to the completion of this project. She indicated
that in 2016, the estimated costs to complete the project were $16,500,000 and due to her strong
management skills, she was able to deliver the project at a lower than expected total cost of $16,400,00
which saved the company $100,000.
Required: Do you agree with Emma? Prepare a brief response indicating whether or not you agree
with Emma and support your answer.
No, I do not agree with Emma. Although the total estimated cost of the project did go down from
$16,500,000 in 2015 to $16,400,000 in 2017, the overall costs of the project were much higher than
expected. Initially, the costs were expected to be $15,000,000. Therefore, Emma completed the
project at $1,400,000 above the expected costs.
More investigation could be done on this matter to see if the variance in costs was out of Emma’s
control and whether or not she should in fact be rewarded for her work. However, based only on the
argument of delivering the project at a lower cost, a performance bonus is not justified.
Question 3 – Contingencies – 9 marks
Situation A) – 5 marks
Topper News Inc. (IFRS) received a lawsuit on October 31st, 2017 for copyright infringement with regards
to an article they published in the summer of 2017. The plaintiff is currently asking Topper for
$3,000,000 in damages.
After receiving this claim, you contacted your in house legal expert and asked him if this claim had any
merit. He indicated that given the circumstances, there is a very remote chance that the judge would
award $3,000,000 to the plaintiff. He indicated that, if this case is taken to court, there is a 40% chance
that you would have to pay nothing and a 60% chance that you would need to pay $1,000,000. He did
indicated however that there is an 80% chance that the client will accept to settle this lawsuit for
$400,000 and a 20% change they will settle for $750,000. After this discussion, the CFO recommends to
attempt settling the case out of court.
Required: Discuss the amount (if any) of the provision that Topper should take to account for this
claim for the year ending December 31st, 2017. Support your answer.
The provision booked should be the most likely amount. In this case, as their intention is to attempt to
settle the lawsuit, the most likely amount they will have to pay is $400,000. Therefore, a provision and
an expense should be booked for this amount in 2017.
The student can also demonstrate their understanding with a journal entry:
Dr. Loss on lawsuit $ 400,000
Cr. Lawsuit Provision $400,000
Marks: 3 points to discuss the need to take the most likely amount.
2 points for using the $400,000 as student needed to recognize the relevant numbers to use
were the ones pertaining to the settlement option as this how management intends to
proceed.
Situation B) – 4 marks
Ming Steel is a Canadian Public company and they have a debt agreement with Edelweiss Bank. The
$30,000,000 debt is maturing in April of 2017 and must be repaid in full per the initial agreement with
the bank. Ming Steel started the negociations with Edelweiss in December 2016 in an effort to
refinance the debt. An agreement was reached between all parties to refinance the debt on January
7th, 2017. The President of Ming Steel was happy about this arrangement as he has now classified the
debt as long-term debt on the Balance Sheet for the year ending December 31st, 2016. As the financial
statements are not issued until the beginning of March, he indicated that this accounting treatment was
perfectly acceptable.
Required: Do you agree with the accounting treatment the President of Ming Steel chose for the
debt? Explain why or why not and ensure that you provide support for your answer and state any
assumptions you make along the way.
I disagree with the treatment of the president. Under IFRS, an agreement must be reached by the date
of the balance sheet. In this case, the agreement was reached on January 7th which is after the Dec 31st,
year end. Therefore, the debt would need to be classified as a current liability.
Required: Would your answer change if Ming reported under ASPE?
Yes, under ASPE, the debt could be classified as long term as the agreement was reached before the
financial statements were issued. ASPE provides a longer period for the debtor and lender to reach an
agreement.
Question 4 – Shareholder’s Equity – 11 marks
Situation A) – 6 marks
The following is an extract of Minto’s Financial Balance Sheet at December 31st, 2016:
Equity
Share Capital $ 7,245,000
Contributed
Surplus $ 50,000
Retained Earnings $ 35,478,990
$ 42,773,990
The Share Capital is made up of 2,500,000 common shares that are issued and outstanding. The entire
balance of the contributed surplus balance relates to the common shares.
On January 15th of 2017, Minto’s management reacquired 200,000 shares at $10 per share which
approximates the market price.
Required: Prepare the journal entry for Minto on January 15th AND provide 2 reasons why
management would want to repurchase their own shares.
Common Shares 579,600*
Retained Earnings 1,370,400
Contributed Surplus $50,000
Cash $2,000,000 (200,000*$10)
*
Share book value = $ 2.898 =7,245,000 book value of shares/2,500,000 outstanding shares
Total repurchase $ 579,600.0 =2.898*200,000 shares repurchased
Reasons: 1 point per valid reason
- To create a market with the shares – make price of shares go up
- To regain control
- Need shares to issue to mgmt. as part of a compensation package
- Other valid….
Situation B) 5 marks
Odwala Industrial announced they would distribute a $15,000,000 cash dividend on December 31st,
2016. The dividend payment needs to be divided between the preferred and common shareholders so
the treasurer enlisted your help to determine the allocation of the dividend. The following information
was provided.
Class of Shares Book Value Market Value
# shares
outstanding
Common Shares $80,750,000 108,879,987 16,000,000
Preferred Shares $48,600,000 67,890,876 9,850,000
TOTAL Share
Capital $129,350,000 $176,770,863
25,850,000
The preferred shares have a 0.20 cent cumulative dividend and they are also participating. There was
no dividend paid on the preferred shares for the past 2 years (i.e. no dividend paid in 2014 and 2015).
Required: Determine how the $15,000,000 dividend should be allocated between the common and
preferred shares.
DIVIDEND PAYABLE
TO: PREF. SHARES COM. SHARES
Div Arrears (2014-2015) $ 3,940,000
Current year Div $ 1,970,000
Dividend to Com.
Shares $3,273,200
Participating Dividend $2,185,516 $3,631,284
$ 8,095,516 $ 6,904,484
Step 1: Consider the need to pay dividend in arear:
2 years * 9,850,000*0.2 $ 3,940,000
Step 2: Consider the dividend for the current year:
9,850,000*0.2 $ 1,970,000
Total Preferred Dividends before
participation $ 5,910,000
Step 3: Determine the dividends to be allocated To Com. shares to match Pref. Shares
$15,000,000-$5,910,000 $ 9,090,000
If paid $1,970,000 for $48,600,000, then you would pay approx 4.05%
Div to be allocated to common share to match Pref'd Div
$80,750,000*4.05%= $3,273,200
Step 4: Compute participating Dividend
A
Allocated
(A*B)
Common Shares $80,750,000 62.43% $3,631,284
Preferred Shares $48,600,000 37.57% $2,185,516
TOTAL Share
Capital $129,350,000
Remaining Dividends to Allocate: $ 9,090,000
Less $3,273,200
$ 5,816,800 B
0.25%
0.50%
0.75%
1.00%
1.50%
2.00%
2.50%
3.00%
4.00%
5.00%
6.00%
7.00%
8.00%
9.00%
10.00%
11.00%
12.00%
1
0.9975
0.9950
0.9926
0.9901
0.9852
0.9804
0.9756
0.9709
0.9615
0.9524
0.9434
0.9346
0.9259
0.9174
0.9091
0.9009
0.8929
2
0.9950
0.9901
0.9852
0.9803
0.9707
0.9612
0.9518
0.9426
0.9246
0.9070
0.8900
0.8734
0.8573
0.8417
0.8264
0.8116
0.7972
3
0.9925
0.9851
0.9778
0.9706
0.9563
0.9423
0.9286
0.9151
0.8890
0.8638
0.8396
0.8163
0.7938
0.7722
0.7513
0.7312
0.7118
4
0.9901
0.9802
0.9706
0.9610
0.9422
0.9238
0.9060
0.8885
0.8548
0.8227
0.7921
0.7629
0.7350
0.7084
0.6830
0.6587
0.6355
5
0.9876
0.9754
0.9633
0.9515
0.9283
0.9057
0.8839
0.8626
0.8219
0.7835
0.7473
0.7130
0.6806
0.6499
0.6209
0.5935
0.5674
6
0.9851
0.9705
0.9562
0.9420
0.9145
0.8880
0.8623
0.8375
0.7903
0.7462
0.7050
0.6663
0.6302
0.5963
0.5645
0.5346
0.5066
7
0.9827
0.9657
0.9490
0.9327
0.9010
0.8706
0.8413
0.8131
0.7599
0.7107
0.6651
0.6227
0.5835
0.5470
0.5132
0.4817
0.4523
8
0.9802
0.9609
0.9420
0.9235
0.8877
0.8535
0.8207
0.7894
0.7307
0.6768
0.6274
0.5820
0.5403
0.5019
0.4665
0.4339
0.4039
9
0.9778
0.9561
0.9350
0.9143
0.8746
0.8368
0.8007
0.7664
0.7026
0.6446
0.5919
0.5439
0.5002
0.4604
0.4241
0.3909
0.3606
10
0.9753
0.9513
0.9280
0.9053
0.8617
0.8203
0.7812
0.7441
0.6756
0.6139
0.5584
0.5083
0.4632
0.4224
0.3855
0.3522
0.3220
11
0.9729
0.9466
0.9211
0.8963
0.8489
0.8043
0.7621
0.7224
0.6496
0.5847
0.5268
0.4751
0.4289
0.3875
0.3505
0.3173
0.2875
12
0.9705
0.9419
0.9142
0.8874
0.8364
0.7885
0.7436
0.7014
0.6246
0.5568
0.4970
0.4440
0.3971
0.3555
0.3186
0.2858
0.2567
13
0.9681
0.9372
0.9074
0.8787
0.8240
0.7730
0.7254
0.6810
0.6006
0.5303
0.4688
0.4150
0.3677
0.3262
0.2897
0.2575
0.2292
14
0.9656
0.9326
0.9007
0.8700
0.8118
0.7579
0.7077
0.6611
0.5775
0.5051
0.4423
0.3878
0.3405
0.2992
0.2633
0.2320
0.2046
15
0.9632
0.9279
0.8940
0.8613
0.7999
0.7430
0.6905
0.6419
0.5553
0.4810
0.4173
0.3624
0.3152
0.2745
0.2394
0.2090
0.1827
16
0.9608
0.9233
0.8873
0.8528
0.7880
0.7284
0.6736
0.6232
0.5339
0.4581
0.3936
0.3387
0.2919
0.2519
0.2176
0.1883
0.1631
17
0.9584
0.9187
0.8807
0.8444
0.7764
0.7142
0.6572
0.6050
0.5134
0.4363
0.3714
0.3166
0.2703
0.2311
0.1978
0.1696
0.1456
18
0.9561
0.9141
0.8742
0.8360
0.7649
0.7002
0.6412
0.5874
0.4936
0.4155
0.3503
0.2959
0.2502
0.2120
0.1799
0.1528
0.1300
19
0.9537
0.9096
0.8676
0.8277
0.7536
0.6864
0.6255
0.5703
0.4746
0.3957
0.3305
0.2765
0.2317
0.1945
0.1635
0.1377
0.1161
20
0.9513
0.9051
0.8612
0.8195
0.7425
0.6730
0.6103
0.5537
0.4564
0.3769
0.3118
0.2584
0.2145
0.1784
0.1486
0.1240
0.1037
21
0.9489
0.9006
0.8548
0.8114
0.7315
0.6598
0.5954
0.5375
0.4388
0.3589
0.2942
0.2415
0.1987
0.1637
0.1351
0.1117
0.0926
22
0.9466
0.8961
0.8484
0.8034
0.7207
0.6468
0.5809
0.5219
0.4220
0.3418
0.2775
0.2257
0.1839
0.1502
0.1228
0.1007
0.0826
23
0.9442
0.8916
0.8421
0.7954
0.7100
0.6342
0.5667
0.5067
0.4057
0.3256
0.2618
0.2109
0.1703
0.1378
0.1117
0.0907
0.0738
24
0.9418
0.8872
0.8358
0.7876
0.6995
0.6217
0.5529
0.4919
0.3901
0.3101
0.2470
0.1971
0.1577
0.1264
0.1015
0.0817
0.0659
25
0.9395
0.8828
0.8296
0.7798
0.6892
0.6095
0.5394
0.4776
0.3751
0.2953
0.2330
0.1842
0.1460
0.1160
0.0923
0.0736
0.0588
30
0.9278
0.8610
0.7992
0.7419
0.6398
0.5521
0.4767
0.4120
0.3083
0.2314
0.1741
0.1314
0.0994
0.0754
0.0573
0.0437
0.0334
35
0.9163
0.8398
0.7699
0.7059
0.5939
0.5000
0.4214
0.3554
0.2534
0.1813
0.1301
0.0937
0.0676
0.0490
0.0356
0.0259
0.0189
40
0.9050
0.8191
0.7416
0.6717
0.5513
0.4529
0.3724
0.3066
0.2083
0.1420
0.0972
0.0668
0.0460
0.0318
0.0221
0.0154
0.0107
50
0.8826
0.7793
0.6883
0.6080
0.4750
0.3715
0.2909
0.2281
0.1407
0.0872
0.0543
0.0339
0.0213
0.0134
0.0085
0.0054
0.0035
PERIODS
PRESENT VALUE OF 1
(Present value of a Single Sum
)
RATE PER PERIOD
0.25%
0.50%
0.75%
1.00%
1.50%
2.00%
2.50%
3.00%
4.00%
5.00%
6.00%
7.00%
8.00%
9.00%
10.00%
11.00%
12.00%
1
1.0000
1.0000
1.0000
1.0000
1.0000
1.0000
1.0000
1.0000
1.0000
1.0000
1.0000
1.0000
1.0000
1.0000
1.0000
1.0000
1.0000
2
1.9975
1.9950
1.9926
1.9901
1.9876
1.9804
1.9756
1.9709
1.9615
1.9524
1.9434
1.9346
1.9259
1.9174
1.9091
1.9009
1.8929
3
2.9925
2.9851
2.9777
2.9704
2.9631
2.9416
2.9274
2.9135
2.8861
2.8594
2.8334
2.8080
2.7833
2.7591
2.7355
2.7125
2.6901
4
3.9851
3.9702
3.9556
3.9410
3.9266
3.8839
3.8560
3.8286
3.7751
3.7232
3.6730
3.6243
3.5771
3.5313
3.4869
3.4437
3.4018
5
4.9751
4.9505
4.9261
4.9020
4.8782
4.8077
4.7620
4.7171
4.6299
4.5460
4.4651
4.3872
4.3121
4.2397
4.1699
4.1024
4.0373
6
5.9627
5.9259
5.8894
5.8534
5.8183
5.7135
5.6458
5.5797
5.4518
5.3295
5.2124
5.1002
4.9927
4.8897
4.7908
4.6959
4.6048
7
6.9478
6.8964
6.8456
6.7955
6.7469
6.6014
6.5081
6.4172
6.2421
6.0757
5.9173
5.7665
5.6229
5.4859
5.3553
5.2305
5.1114
8
7.9305
7.8621
7.7946
7.7282
7.6642
7.4720
7.3494
7.2303
7.0021
6.7864
6.5824
6.3893
6.2064
6.0330
5.8684
5.7122
5.5638
9
8.9107
8.8230
8.7366
8.6517
8.5704
8.3255
8.1701
8.0197
7.7327
7.4632
7.2098
6.9713
6.7466
6.5348
6.3349
6.1461
5.9676
10
9.8885
9.7791
9.6716
9.5660
9.4656
9.1622
8.9709
8.7861
8.4353
8.1078
7.8017
7.5152
7.2469
6.9952
6.7590
6.5370
6.3282
11
10.8639
10.7304
10.5996
10.4713
10.3501
9.9826
9.7521
9.5302
9.1109
8.7217
8.3601
8.0236
7.7101
7.4177
7.1446
6.8892
6.6502
12
11.8368
11.6770
11.5207
11.3676
11.2239
10.7868
10.5142
10.2526
9.7605
9.3064
8.8869
8.4987
8.1390
7.8052
7.4951
7.2065
6.9377
13
12.8073
12.6189
12.4349
12.2551
12.0873
11.5753
11.2578
10.9540
10.3851
9.8633
9.3838
8.9427
8.5361
8.1607
7.8137
7.4924
7.1944
14
13.7753
13.5562
13.3423
13.1337
12.9404
12.3484
11.9832
11.6350
10.9856
10.3936
9.8527
9.3577
8.9038
8.4869
8.1034
7.7499
7.4235
15
14.7410
14.4887
14.2430
14.0037
13.7834
13.1062
12.6909
12.2961
11.5631
10.8986
10.2950
9.7455
9.2442
8.7862
8.3667
7.9819
7.6282
16
15.7042
15.4166
15.1370
14.8651
14.6163
13.8493
13.3814
12.9379
12.1184
11.3797
10.7122
10.1079
9.5595
9.0607
8.6061
8.1909
7.8109
17
16.6650
16.3399
16.0243
15.7179
15.4394
14.5777
14.0550
13.5611
12.6523
11.8378
11.1059
10.4466
9.8514
9.3126
8.8237
8.3792
7.9740
18
17.6235
17.2586
16.9050
16.5623
16.2527
15.2919
14.7122
14.1661
13.1657
12.2741
11.4773
10.7632
10.1216
9.5436
9.0216
8.5488
8.1196
19
18.5795
18.1728
17.7792
17.3983
17.0565
15.9920
15.3534
14.7535
13.6593
12.6896
11.8276
11.0591
10.3719
9.7556
9.2014
8.7016
8.2497
20
19.5332
19.0824
18.6468
18.2260
17.8509
16.6785
15.9789
15.3238
14.1339
13.0853
12.1581
11.3356
10.6036
9.9501
9.3649
8.8393
8.3658
21
20.4845
19.9874
19.5080
19.0456
18.6360
17.3514
16.5892
15.8775
14.5903
13.4622
12.4699
11.5940
10.8181
10.1285
9.5136
8.9633
8.4694
22
21.4334
20.8880
20.3628
19.8570
19.4119
18.0112
17.1845
16.4150
15.0292
13.8212
12.7641
11.8355
11.0168
10.2922
9.6487
9.0751
8.5620
23
22.3800
21.7841
21.2112
20.6604
20.1788
18.6580
17.7654
16.9369
15.4511
14.1630
13.0416
12.0612
11.2007
10.4424
9.7715
9.1757
8.6446
24
23.3241
22.6757
22.0533
21.4558
20.9368
19.2922
18.3321
17.4436
15.8568
14.4886
13.3034
12.2722
11.3711
10.5802
9.8832
9.2664
8.7184
25
24.2660
23.5629
22.8891
22.2434
21.6860
19.9139
18.8850
17.9355
16.2470
14.7986
13.5504
12.4693
11.5288
10.7066
9.9847
9.3481
8.7843
30
28.9400
27.9330
26.9759
26.0658
25.3049
22.8444
21.4535
20.1885
17.9837
16.1411
14.5907
13.2777
12.1584
11.1983
10.3696
9.6501
9.0218
35
33.5561
32.1955
30.9128
29.7027
28.7227
25.4986
23.7238
22.1318
19.4112
17.1929
15.3681
13.8540
12.5869
11.5178
10.6086
9.8293
9.1566
40
38.1149
36.3531
34.7053
33.1630
31.9531
27.9026
25.7303
23.8082
20.5845
18.0170
15.9491
14.2649
12.8786
11.7255
10.7570
9.9357
9.2330
50
47.0635
44.3635
41.8782
39.5881
37.9012
32.0521
29.0714
26.5017
22.3415
19.1687
16.7076
14.7668
13.2122
11.9482
10.9063
10.0362
9.3010
PRESENT VALUE OF ANNUITY DUE
(Annuity in advance - beginning of period paym
ents)
PERIODS
RATE PER PERIOD
0.25%
0.50%
0.75%
1.00%
1.50%
2.00%
2.50%
3.00%
4.00%
5.00%
6.00%
7.00%
8.00%
9.00%
10.00%
11.00%
12.00%
1
0.9975
0.9950
0.9926
0.9901
0.9852
0.9804
0.9756
0.9709
0.9615
0.9524
0.9434
0.9346
0.9259
0.9174
0.9091
0.9009
0.8929
2
1.9925
1.9851
1.9777
1.9704
1.9559
1.9416
1.9274
1.9135
1.8861
1.8594
1.8334
1.8080
1.7833
1.7591
1.7355
1.7125
1.6901
3
2.9851
2.9702
2.9556
2.9410
2.9122
2.8839
2.8560
2.8286
2.7751
2.7232
2.6730
2.6243
2.5771
2.5313
2.4869
2.4437
2.4018
4
3.9751
3.9505
3.9261
3.9020
3.8544
3.8077
3.7620
3.7171
3.6299
3.5460
3.4651
3.3872
3.3121
3.2397
3.1699
3.1024
3.0373
5
4.9627
4.9259
4.8894
4.8534
4.7826
4.7135
4.6458
4.5797
4.4518
4.3295
4.2124
4.1002
3.9927
3.8897
3.7908
3.6959
3.6048
6
5.9478
5.8964
5.8456
5.7955
5.6972
5.6014
5.5081
5.4172
5.2421
5.0757
4.9173
4.7665
4.6229
4.4859
4.3553
4.2305
4.1114
7
6.9305
6.8621
6.7946
6.7282
6.5982
6.4720
6.3494
6.2303
6.0021
5.7864
5.5824
5.3893
5.2064
5.0330
4.8684
4.7122
4.5638
8
7.9107
7.8230
7.7366
7.6517
7.4859
7.3255
7.1701
7.0197
6.7327
6.4632
6.2098
5.9713
5.7466
5.5348
5.3349
5.1461
4.9676
9
8.8885
8.7791
8.6716
8.5660
8.3605
8.1622
7.9709
7.7861
7.4353
7.1078
6.8017
6.5152
6.2469
5.9952
5.7590
5.5370
5.3282
10
9.8639
9.7304
9.5996
9.4713
9.2222
8.9826
8.7521
8.5302
8.1109
7.7217
7.3601
7.0236
6.7101
6.4177
6.1446
5.8892
5.6502
11
10.8368
10.6770
10.5207
10.3676
10.0711
9.7868
9.5142
9.2526
8.7605
8.3064
7.8869
7.4987
7.1390
6.8052
6.4951
6.2065
5.9377
12
11.8073
11.6189
11.4349
11.2551
10.9075
10.5753
10.2578
9.9540
9.3851
8.8633
8.3838
7.9427
7.5361
7.1607
6.8137
6.4924
6.1944
13
12.7753
12.5562
12.3423
12.1337
11.7315
11.3484
10.9832
10.6350
9.9856
9.3936
8.8527
8.3577
7.9038
7.4869
7.1034
6.7499
6.4235
14
13.7410
13.4887
13.2430
13.0037
12.5434
12.1062
11.6909
11.2961
10.5631
9.8986
9.2950
8.7455
8.2442
7.7862
7.3667
6.9819
6.6282
15
14.7042
14.4166
14.1370
13.8651
13.3432
12.8493
12.3814
11.9379
11.1184
10.3797
9.7122
9.1079
8.5595
8.0607
7.6061
7.1909
6.8109
16
15.6650
15.3399
15.0243
14.7179
14.1313
13.5777
13.0550
12.5611
11.6523
10.8378
10.1059
9.4466
8.8514
8.3126
7.8237
7.3792
6.9740
17
16.6235
16.2586
15.9050
15.5623
14.9076
14.2919
13.7122
13.1661
12.1657
11.2741
10.4773
9.7632
9.1216
8.5436
8.0216
7.5488
7.1196
18
17.5795
17.1728
16.7792
16.3983
15.6726
14.9920
14.3534
13.7535
12.6593
11.6896
10.8276
10.0591
9.3719
8.7556
8.2014
7.7016
7.2497
19
18.5332
18.0824
17.6468
17.2260
16.4262
15.6785
14.9789
14.3238
13.1339
12.0853
11.1581
10.3356
9.6036
8.9501
8.3649
7.8393
7.3658
20
19.4845
18.9874
18.5080
18.0456
17.1686
16.3514
15.5892
14.8775
13.5903
12.4622
11.4699
10.5940
9.8181
9.1285
8.5136
7.9633
7.4694
21
20.4334
19.8880
19.3628
18.8570
17.9001
17.0112
16.1845
15.4150
14.0292
12.8212
11.7641
10.8355
10.0168
9.2922
8.6487
8.0751
7.5620
22
21.3800
20.7841
20.2112
19.6604
18.6208
17.6580
16.7654
15.9369
14.4511
13.1630
12.0416
11.0612
10.2007
9.4424
8.7715
8.1757
7.6446
23
22.3241
21.6757
21.0533
20.4558
19.3309
18.2922
17.3321
16.4436
14.8568
13.4886
12.3034
11.2722
10.3711
9.5802
8.8832
8.2664
7.7184
24
23.2660
22.5629
21.8891
21.2434
20.0304
18.9139
17.8850
16.9355
15.2470
13.7986
12.5504
11.4693
10.5288
9.7066
8.9847
8.3481
7.7843
25
24.2055
23.4456
22.7188
22.0232
20.7196
19.5235
18.4244
17.4131
15.6221
14.0939
12.7834
11.6536
10.6748
9.8226
9.0770
8.4217
7.8431
30
28.8679
27.7941
26.7751
25.8077
24.0158
22.3965
20.9303
19.6004
17.2920
15.3725
13.7648
12.4090
11.2578
10.2737
9.4269
8.6938
8.0552
35
33.4724
32.0354
30.6827
29.4086
27.0756
24.9986
23.1452
21.4872
18.6646
16.3742
14.4982
12.9477
11.6546
10.5668
9.6442
8.8552
8.1755
40
38.0199
36.1722
34.4469
32.8347
29.9158
27.3555
25.1028
23.1148
19.7928
17.1591
15.0463
13.3317
11.9246
10.7574
9.7791
8.9511
8.2438
50
46.9462
44.1428
41.5664
39.1961
34.9997
31.4236
28.3623
25.7298
21.4822
18.2559
15.7619
13.8007
12.2335
10.9617
9.9148
9.0417
8.3045
PERIODS
PRESENT VALUE OF ORDINARY ANNUITY
(Annuity paid at the end of the period)
RATE PER PERIOD
and
Rotman School of Management
RSM 221H1S – Intermediate Financial Accounting II
SAMPLE EXAM
with solution
This sample exam is a modified version of the on the Feb 15, 2017 in-person Mid-term Exam
Section # 101 – C.BARRETTE
Duration: 1 hour and 50 minutes
------------------------------------------------------------------------------------------------------------------------------
Grade
MC Questions /18
Question 1 /14
Question 2 /18
Question 3 /9
Question 4 /11
Total : /70
Multiple Choice Questions : 18 marks------------------------------------------------------------------------------------
The midterm exam might include a set of multiple choice questions. The format of these questions is
similar to the WileyPlus quizzes.
Question 1 – Long Term Debt – 14 marks
i) 9 marks - Based on the information above, prepare the journal entries for March 1st, 2016,
September 1st, 2016 and December 31st, 2016. Indy reports under IFRS and must use the
effective interest rate method to amortize any premiums or discount.
March 1st, 2016 (2 marks)
Cash ………………………………………………………………. $2,074,859
Bond Payable……………………………………………………….$2,074,859
September 1st, 2016 (4 marks)
Interest Expense……………………………..$31,123
Bond Payable………………………………….$8,877
Cash……………………………………………………………….40,000
Date Cash Paid
Interest
Expense
Premium
Amortization
Carrying
Amount of
Bond
Interest
rate
March 1st, 2016 2,074,859$ 1.50%
Sept 1st, 2016 40,000$ 31,123$ 8,877$ 2,065,982$ 1.50%
March 1st, 2017 40,000$ 30,990$ 9,010$ 2,056,972$ 1.50%
Sept 1st, 2017 40,000$ 30,855$ 9,145$ 2,047,826$ 1.50%
March 1st, 2018 40,000$ 30,717$ 9,283$ 2,038,544$ 1.50%
Sept 1st, 2018 40,000$ 30,578$ 9,422$ 2,029,122$ 1.50%
March 1st, 2019 40,000$ 30,437$ 9,563$ 2,019,559$ 1.50%
Sept 1st, 2019 40,000$ 30,293$ 9,707$ 2,009,852$ 1.50%
March 1st, 2020 40,000$ 30,148$ 9,852$ 2,000,000$ 1.50%
December 31st, 2016 (3 marks)
Interest Expense……………………………$20,660
Bond Payable…………………………………$6,007
Interest Payable…………………………………………$26,667
Note: If a template is provided in your exam, you must use the template to
answer the question.
Situation B – 5 marks
Marigold Corp issued bonds payable on January 1st, 2016. The bonds have a face value of $25,000,000,
a coupon rate of 6% and the interest is payable annually on the anniversary date of the bonds. When
the bonds payable were issued, the market rate was 6.25% which resulted in the bond being sold at a
discount.
The amortization table for the bonds payable that was prepared on January 1st, 2016 when the bonds
were issued is shown below:
On January 2nd, 2021, Marigold Corp decided to repay the loan early as they had excess cash on hand.
The imperial Bank allowed them to cancel the loan for the equivalent of the market value of the loan on
January 2nd, 2021. The market rate on January 2021 was 5%.
Required: Compute the market value of the loan on January 2nd, 2021 and prepare a journal entry to
record the early settlement of the bonds payable. (hint: The market value of the loan can be
computed by finding the PV of the bonds payable with similar terms under the current market rate
conditions).
Date Cash Paid
Interest
Expense
Premium
Amortization
Carrying
Amount of
Bond
Interest
rate
January 1st, 2016 24,545,394$ 6.25%
January 1st, 2017 1,500,000$ 1,534,087$ 34,087$ 24,579,481$ 6.25%
January 1st, 2018 1,500,000$ 1,536,218$ 36,218$ 24,615,699$ 6.25%
January 1st, 2019 1,500,000$ 1,538,481$ 38,481$ 24,654,180$ 6.25%
January 1st, 2020 1,500,000$ 1,540,886$ 40,886$ 24,695,067$ 6.25%
January 1st, 2021 1,500,000$ 1,543,442$ 43,442$ 24,738,508$ 6.25%
January 1st, 2022 1,500,000$ 1,546,157$ 46,157$ 24,784,665$ 6.25%
January 1st, 2023 1,500,000$ 1,549,042$ 49,042$ 24,833,706$ 6.25%
January 1st, 2024 1,500,000$ 1,552,107$ 52,107$ 24,885,813$ 6.25%
January 1st, 2025 1,500,000$ 1,555,363$ 55,363$ 24,941,176$ 6.25%
January 1st, 2026 1,500,000$ 1,558,824$ 58,824$ 25,000,000$ 6.25%
PV factor
from tables.
PV of the principal Amount 25000000 0.78353 $ 19,588,250
PV of ordinary annuity 1500000 4.32948 $ 6,494,220
$ 26,082,470
Variables used: Nper=5, Rate = 5%,
Bond Payable 24,738,508
Loss on early redemption of bond 1,343,962
Cash 26,082,470
Question 2 – Percentage of Completion Method – 18 marks
Jia Consulting is currently developing a new customized accounting system for Rio Wholesales Canada.
Jia consulting started the project in November of 2015 and completed the project half way into 2017.
A fixed price of $17,000,000 was negotiated between Jia and Rio as the compensation for this project.
The table below shows a summary of costs and expected costs for each of the 3 years of the project.
Jia Consulting reports under IFRS and has a year end of December 31st.
2015 2016 2017
Costs to date $ 3,800,000 $10,750,000 $16,400,000
Estimated costs to
complete
$11,200,000 $5,750,000 0
Estimated total costs $15,000,000 $16,500,000 $16,400,000
Progress Billing
during the year
$5,000,000 $5,000,000 $7,000,000
Part I (15 marks) – Required : Based on the information provided above, prepare the journal entries
at December 31st, 2015, 2016 and 2017 for Jia Consulting to account for the Rio Wholesale Project.
DECEMBER 31st, 2015
Journal Entry
Contract Asset / Liability $3,800,000
Materials, Payables, Cash…. $3,800,000
* To record the cost of construction
Accounts Receivables $5,000,000
Contract Asset Liability $5,000,000
* To record the progress billing made during the year
Contract Asset Liability $4,306,100
Revenues from Long Term Contract $4,306,100
* To record the revenues for the year
Construction Expenses $3,800,000
Contract Asset / Liability $3,800,000
To record the construction expense for the year.
Support Computations:
Costs to date = 3,800,000
Total Costs = 15,000,000
% complete = 25.33%
25.33% * 17,000,000 = $4,306,100
DECEMBER 31st, 2016
Journal Entry
Contract Asset / Liability $6,950,000
Materials, Payables, Cash…. $6,950,000
* To record the cost of construction
Accounts Receivables $5,000,000
Contract Asset Liability $5,000,000
* To record the progress billing made during the year
Contract Asset Liability $6,769,657
Revenues from Long Term Contract $6,769,657
* To record the revenues for the year
Construction Expenses $6,950,000
Contract Asset / Liability $6,950,000
To record the construction expense for the year.
Support Computations:
Costs to date = 10,750,000
Total Costs = 16,500,000
% complete = 65.15%
65.15 * 17,000,000 = 11,075,757
Revenue to be recognized in the current year: 11,075,757 – 4,306,100 = 6,769,657
DECEMBER 31st, 2017
Journal Entry
Contract Asset / Liability $,5,650,000
Materials, Payables, Cash…. $5,650,000
* To record the cost of construction
Accounts Receivables $7,000,000
Contract Asset Liability $7,000,000
* To record the progress billing made during the year
Contract Asset Liability $5,924,243
Revenues from Long Term Contract $5,924,243
* To record the revenues for the year
Construction Expenses $5,650,000
Contract Asset / Liability $5,650,000
To record the construction expense for the year.
Support Computations
Costs to date = 16,400,000
Total Costs = 16,400,000
% complete = 100%
Revenue to be recognized in the current year: 17,000,000 – 11,075,757 = $5,924,243
Part II (3 marks)
Emma was the project manager for the Rio Wholesale project. She comes to see you, the VP Finance of
Jia, and asks you for a performance bonus with regards to the completion of this project. She indicated
that in 2016, the estimated costs to complete the project were $16,500,000 and due to her strong
management skills, she was able to deliver the project at a lower than expected total cost of $16,400,00
which saved the company $100,000.
Required: Do you agree with Emma? Prepare a brief response indicating whether or not you agree
with Emma and support your answer.
No, I do not agree with Emma. Although the total estimated cost of the project did go down from
$16,500,000 in 2015 to $16,400,000 in 2017, the overall costs of the project were much higher than
expected. Initially, the costs were expected to be $15,000,000. Therefore, Emma completed the
project at $1,400,000 above the expected costs.
More investigation could be done on this matter to see if the variance in costs was out of Emma’s
control and whether or not she should in fact be rewarded for her work. However, based only on the
argument of delivering the project at a lower cost, a performance bonus is not justified.
Question 3 – Contingencies – 9 marks
Situation A) – 5 marks
Topper News Inc. (IFRS) received a lawsuit on October 31st, 2017 for copyright infringement with regards
to an article they published in the summer of 2017. The plaintiff is currently asking Topper for
$3,000,000 in damages.
After receiving this claim, you contacted your in house legal expert and asked him if this claim had any
merit. He indicated that given the circumstances, there is a very remote chance that the judge would
award $3,000,000 to the plaintiff. He indicated that, if this case is taken to court, there is a 40% chance
that you would have to pay nothing and a 60% chance that you would need to pay $1,000,000. He did
indicated however that there is an 80% chance that the client will accept to settle this lawsuit for
$400,000 and a 20% change they will settle for $750,000. After this discussion, the CFO recommends to
attempt settling the case out of court.
Required: Discuss the amount (if any) of the provision that Topper should take to account for this
claim for the year ending December 31st, 2017. Support your answer.
The provision booked should be the most likely amount. In this case, as their intention is to attempt to
settle the lawsuit, the most likely amount they will have to pay is $400,000. Therefore, a provision and
an expense should be booked for this amount in 2017.
The student can also demonstrate their understanding with a journal entry:
Dr. Loss on lawsuit $ 400,000
Cr. Lawsuit Provision $400,000
Marks: 3 points to discuss the need to take the most likely amount.
2 points for using the $400,000 as student needed to recognize the relevant numbers to use
were the ones pertaining to the settlement option as this how management intends to
proceed.
Situation B) – 4 marks
Ming Steel is a Canadian Public company and they have a debt agreement with Edelweiss Bank. The
$30,000,000 debt is maturing in April of 2017 and must be repaid in full per the initial agreement with
the bank. Ming Steel started the negociations with Edelweiss in December 2016 in an effort to
refinance the debt. An agreement was reached between all parties to refinance the debt on January
7th, 2017. The President of Ming Steel was happy about this arrangement as he has now classified the
debt as long-term debt on the Balance Sheet for the year ending December 31st, 2016. As the financial
statements are not issued until the beginning of March, he indicated that this accounting treatment was
perfectly acceptable.
Required: Do you agree with the accounting treatment the President of Ming Steel chose for the
debt? Explain why or why not and ensure that you provide support for your answer and state any
assumptions you make along the way.
I disagree with the treatment of the president. Under IFRS, an agreement must be reached by the date
of the balance sheet. In this case, the agreement was reached on January 7th which is after the Dec 31st,
year end. Therefore, the debt would need to be classified as a current liability.
Required: Would your answer change if Ming reported under ASPE?
Yes, under ASPE, the debt could be classified as long term as the agreement was reached before the
financial statements were issued. ASPE provides a longer period for the debtor and lender to reach an
agreement.
Question 4 – Shareholder’s Equity – 11 marks
Situation A) – 6 marks
The following is an extract of Minto’s Financial Balance Sheet at December 31st, 2016:
Equity
Share Capital $ 7,245,000
Contributed
Surplus $ 50,000
Retained Earnings $ 35,478,990
$ 42,773,990
The Share Capital is made up of 2,500,000 common shares that are issued and outstanding. The entire
balance of the contributed surplus balance relates to the common shares.
On January 15th of 2017, Minto’s management reacquired 200,000 shares at $10 per share which
approximates the market price.
Required: Prepare the journal entry for Minto on January 15th AND provide 2 reasons why
management would want to repurchase their own shares.
Common Shares 579,600*
Retained Earnings 1,370,400
Contributed Surplus $50,000
Cash $2,000,000 (200,000*$10)
*
Share book value = $ 2.898 =7,245,000 book value of shares/2,500,000 outstanding shares
Total repurchase $ 579,600.0 =2.898*200,000 shares repurchased
Reasons: 1 point per valid reason
- To create a market with the shares – make price of shares go up
- To regain control
- Need shares to issue to mgmt. as part of a compensation package
- Other valid….
Situation B) 5 marks
Odwala Industrial announced they would distribute a $15,000,000 cash dividend on December 31st,
2016. The dividend payment needs to be divided between the preferred and common shareholders so
the treasurer enlisted your help to determine the allocation of the dividend. The following information
was provided.
Class of Shares Book Value Market Value
# shares
outstanding
Common Shares $80,750,000 108,879,987 16,000,000
Preferred Shares $48,600,000 67,890,876 9,850,000
TOTAL Share
Capital $129,350,000 $176,770,863
25,850,000
The preferred shares have a 0.20 cent cumulative dividend and they are also participating. There was
no dividend paid on the preferred shares for the past 2 years (i.e. no dividend paid in 2014 and 2015).
Required: Determine how the $15,000,000 dividend should be allocated between the common and
preferred shares.
DIVIDEND PAYABLE
TO: PREF. SHARES COM. SHARES
Div Arrears (2014-2015) $ 3,940,000
Current year Div $ 1,970,000
Dividend to Com.
Shares $3,273,200
Participating Dividend $2,185,516 $3,631,284
$ 8,095,516 $ 6,904,484
Step 1: Consider the need to pay dividend in arear:
2 years * 9,850,000*0.2 $ 3,940,000
Step 2: Consider the dividend for the current year:
9,850,000*0.2 $ 1,970,000
Total Preferred Dividends before
participation $ 5,910,000
Step 3: Determine the dividends to be allocated To Com. shares to match Pref. Shares
$15,000,000-$5,910,000 $ 9,090,000
If paid $1,970,000 for $48,600,000, then you would pay approx 4.05%
Div to be allocated to common share to match Pref'd Div
$80,750,000*4.05%= $3,273,200
Step 4: Compute participating Dividend
A
Allocated
(A*B)
Common Shares $80,750,000 62.43% $3,631,284
Preferred Shares $48,600,000 37.57% $2,185,516
TOTAL Share
Capital $129,350,000
Remaining Dividends to Allocate: $ 9,090,000
Less $3,273,200
$ 5,816,800 B
0.25%
0.50%
0.75%
1.00%
1.50%
2.00%
2.50%
3.00%
4.00%
5.00%
6.00%
7.00%
8.00%
9.00%
10.00%
11.00%
12.00%
1
0.9975
0.9950
0.9926
0.9901
0.9852
0.9804
0.9756
0.9709
0.9615
0.9524
0.9434
0.9346
0.9259
0.9174
0.9091
0.9009
0.8929
2
0.9950
0.9901
0.9852
0.9803
0.9707
0.9612
0.9518
0.9426
0.9246
0.9070
0.8900
0.8734
0.8573
0.8417
0.8264
0.8116
0.7972
3
0.9925
0.9851
0.9778
0.9706
0.9563
0.9423
0.9286
0.9151
0.8890
0.8638
0.8396
0.8163
0.7938
0.7722
0.7513
0.7312
0.7118
4
0.9901
0.9802
0.9706
0.9610
0.9422
0.9238
0.9060
0.8885
0.8548
0.8227
0.7921
0.7629
0.7350
0.7084
0.6830
0.6587
0.6355
5
0.9876
0.9754
0.9633
0.9515
0.9283
0.9057
0.8839
0.8626
0.8219
0.7835
0.7473
0.7130
0.6806
0.6499
0.6209
0.5935
0.5674
6
0.9851
0.9705
0.9562
0.9420
0.9145
0.8880
0.8623
0.8375
0.7903
0.7462
0.7050
0.6663
0.6302
0.5963
0.5645
0.5346
0.5066
7
0.9827
0.9657
0.9490
0.9327
0.9010
0.8706
0.8413
0.8131
0.7599
0.7107
0.6651
0.6227
0.5835
0.5470
0.5132
0.4817
0.4523
8
0.9802
0.9609
0.9420
0.9235
0.8877
0.8535
0.8207
0.7894
0.7307
0.6768
0.6274
0.5820
0.5403
0.5019
0.4665
0.4339
0.4039
9
0.9778
0.9561
0.9350
0.9143
0.8746
0.8368
0.8007
0.7664
0.7026
0.6446
0.5919
0.5439
0.5002
0.4604
0.4241
0.3909
0.3606
10
0.9753
0.9513
0.9280
0.9053
0.8617
0.8203
0.7812
0.7441
0.6756
0.6139
0.5584
0.5083
0.4632
0.4224
0.3855
0.3522
0.3220
11
0.9729
0.9466
0.9211
0.8963
0.8489
0.8043
0.7621
0.7224
0.6496
0.5847
0.5268
0.4751
0.4289
0.3875
0.3505
0.3173
0.2875
12
0.9705
0.9419
0.9142
0.8874
0.8364
0.7885
0.7436
0.7014
0.6246
0.5568
0.4970
0.4440
0.3971
0.3555
0.3186
0.2858
0.2567
13
0.9681
0.9372
0.9074
0.8787
0.8240
0.7730
0.7254
0.6810
0.6006
0.5303
0.4688
0.4150
0.3677
0.3262
0.2897
0.2575
0.2292
14
0.9656
0.9326
0.9007
0.8700
0.8118
0.7579
0.7077
0.6611
0.5775
0.5051
0.4423
0.3878
0.3405
0.2992
0.2633
0.2320
0.2046
15
0.9632
0.9279
0.8940
0.8613
0.7999
0.7430
0.6905
0.6419
0.5553
0.4810
0.4173
0.3624
0.3152
0.2745
0.2394
0.2090
0.1827
16
0.9608
0.9233
0.8873
0.8528
0.7880
0.7284
0.6736
0.6232
0.5339
0.4581
0.3936
0.3387
0.2919
0.2519
0.2176
0.1883
0.1631
17
0.9584
0.9187
0.8807
0.8444
0.7764
0.7142
0.6572
0.6050
0.5134
0.4363
0.3714
0.3166
0.2703
0.2311
0.1978
0.1696
0.1456
18
0.9561
0.9141
0.8742
0.8360
0.7649
0.7002
0.6412
0.5874
0.4936
0.4155
0.3503
0.2959
0.2502
0.2120
0.1799
0.1528
0.1300
19
0.9537
0.9096
0.8676
0.8277
0.7536
0.6864
0.6255
0.5703
0.4746
0.3957
0.3305
0.2765
0.2317
0.1945
0.1635
0.1377
0.1161
20
0.9513
0.9051
0.8612
0.8195
0.7425
0.6730
0.6103
0.5537
0.4564
0.3769
0.3118
0.2584
0.2145
0.1784
0.1486
0.1240
0.1037
21
0.9489
0.9006
0.8548
0.8114
0.7315
0.6598
0.5954
0.5375
0.4388
0.3589
0.2942
0.2415
0.1987
0.1637
0.1351
0.1117
0.0926
22
0.9466
0.8961
0.8484
0.8034
0.7207
0.6468
0.5809
0.5219
0.4220
0.3418
0.2775
0.2257
0.1839
0.1502
0.1228
0.1007
0.0826
23
0.9442
0.8916
0.8421
0.7954
0.7100
0.6342
0.5667
0.5067
0.4057
0.3256
0.2618
0.2109
0.1703
0.1378
0.1117
0.0907
0.0738
24
0.9418
0.8872
0.8358
0.7876
0.6995
0.6217
0.5529
0.4919
0.3901
0.3101
0.2470
0.1971
0.1577
0.1264
0.1015
0.0817
0.0659
25
0.9395
0.8828
0.8296
0.7798
0.6892
0.6095
0.5394
0.4776
0.3751
0.2953
0.2330
0.1842
0.1460
0.1160
0.0923
0.0736
0.0588
30
0.9278
0.8610
0.7992
0.7419
0.6398
0.5521
0.4767
0.4120
0.3083
0.2314
0.1741
0.1314
0.0994
0.0754
0.0573
0.0437
0.0334
35
0.9163
0.8398
0.7699
0.7059
0.5939
0.5000
0.4214
0.3554
0.2534
0.1813
0.1301
0.0937
0.0676
0.0490
0.0356
0.0259
0.0189
40
0.9050
0.8191
0.7416
0.6717
0.5513
0.4529
0.3724
0.3066
0.2083
0.1420
0.0972
0.0668
0.0460
0.0318
0.0221
0.0154
0.0107
50
0.8826
0.7793
0.6883
0.6080
0.4750
0.3715
0.2909
0.2281
0.1407
0.0872
0.0543
0.0339
0.0213
0.0134
0.0085
0.0054
0.0035
PERIODS
PRESENT VALUE OF 1
(Present value of a Single Sum
)
RATE PER PERIOD
0.25%
0.50%
0.75%
1.00%
1.50%
2.00%
2.50%
3.00%
4.00%
5.00%
6.00%
7.00%
8.00%
9.00%
10.00%
11.00%
12.00%
1
1.0000
1.0000
1.0000
1.0000
1.0000
1.0000
1.0000
1.0000
1.0000
1.0000
1.0000
1.0000
1.0000
1.0000
1.0000
1.0000
1.0000
2
1.9975
1.9950
1.9926
1.9901
1.9876
1.9804
1.9756
1.9709
1.9615
1.9524
1.9434
1.9346
1.9259
1.9174
1.9091
1.9009
1.8929
3
2.9925
2.9851
2.9777
2.9704
2.9631
2.9416
2.9274
2.9135
2.8861
2.8594
2.8334
2.8080
2.7833
2.7591
2.7355
2.7125
2.6901
4
3.9851
3.9702
3.9556
3.9410
3.9266
3.8839
3.8560
3.8286
3.7751
3.7232
3.6730
3.6243
3.5771
3.5313
3.4869
3.4437
3.4018
5
4.9751
4.9505
4.9261
4.9020
4.8782
4.8077
4.7620
4.7171
4.6299
4.5460
4.4651
4.3872
4.3121
4.2397
4.1699
4.1024
4.0373
6
5.9627
5.9259
5.8894
5.8534
5.8183
5.7135
5.6458
5.5797
5.4518
5.3295
5.2124
5.1002
4.9927
4.8897
4.7908
4.6959
4.6048
7
6.9478
6.8964
6.8456
6.7955
6.7469
6.6014
6.5081
6.4172
6.2421
6.0757
5.9173
5.7665
5.6229
5.4859
5.3553
5.2305
5.1114
8
7.9305
7.8621
7.7946
7.7282
7.6642
7.4720
7.3494
7.2303
7.0021
6.7864
6.5824
6.3893
6.2064
6.0330
5.8684
5.7122
5.5638
9
8.9107
8.8230
8.7366
8.6517
8.5704
8.3255
8.1701
8.0197
7.7327
7.4632
7.2098
6.9713
6.7466
6.5348
6.3349
6.1461
5.9676
10
9.8885
9.7791
9.6716
9.5660
9.4656
9.1622
8.9709
8.7861
8.4353
8.1078
7.8017
7.5152
7.2469
6.9952
6.7590
6.5370
6.3282
11
10.8639
10.7304
10.5996
10.4713
10.3501
9.9826
9.7521
9.5302
9.1109
8.7217
8.3601
8.0236
7.7101
7.4177
7.1446
6.8892
6.6502
12
11.8368
11.6770
11.5207
11.3676
11.2239
10.7868
10.5142
10.2526
9.7605
9.3064
8.8869
8.4987
8.1390
7.8052
7.4951
7.2065
6.9377
13
12.8073
12.6189
12.4349
12.2551
12.0873
11.5753
11.2578
10.9540
10.3851
9.8633
9.3838
8.9427
8.5361
8.1607
7.8137
7.4924
7.1944
14
13.7753
13.5562
13.3423
13.1337
12.9404
12.3484
11.9832
11.6350
10.9856
10.3936
9.8527
9.3577
8.9038
8.4869
8.1034
7.7499
7.4235
15
14.7410
14.4887
14.2430
14.0037
13.7834
13.1062
12.6909
12.2961
11.5631
10.8986
10.2950
9.7455
9.2442
8.7862
8.3667
7.9819
7.6282
16
15.7042
15.4166
15.1370
14.8651
14.6163
13.8493
13.3814
12.9379
12.1184
11.3797
10.7122
10.1079
9.5595
9.0607
8.6061
8.1909
7.8109
17
16.6650
16.3399
16.0243
15.7179
15.4394
14.5777
14.0550
13.5611
12.6523
11.8378
11.1059
10.4466
9.8514
9.3126
8.8237
8.3792
7.9740
18
17.6235
17.2586
16.9050
16.5623
16.2527
15.2919
14.7122
14.1661
13.1657
12.2741
11.4773
10.7632
10.1216
9.5436
9.0216
8.5488
8.1196
19
18.5795
18.1728
17.7792
17.3983
17.0565
15.9920
15.3534
14.7535
13.6593
12.6896
11.8276
11.0591
10.3719
9.7556
9.2014
8.7016
8.2497
20
19.5332
19.0824
18.6468
18.2260
17.8509
16.6785
15.9789
15.3238
14.1339
13.0853
12.1581
11.3356
10.6036
9.9501
9.3649
8.8393
8.3658
21
20.4845
19.9874
19.5080
19.0456
18.6360
17.3514
16.5892
15.8775
14.5903
13.4622
12.4699
11.5940
10.8181
10.1285
9.5136
8.9633
8.4694
22
21.4334
20.8880
20.3628
19.8570
19.4119
18.0112
17.1845
16.4150
15.0292
13.8212
12.7641
11.8355
11.0168
10.2922
9.6487
9.0751
8.5620
23
22.3800
21.7841
21.2112
20.6604
20.1788
18.6580
17.7654
16.9369
15.4511
14.1630
13.0416
12.0612
11.2007
10.4424
9.7715
9.1757
8.6446
24
23.3241
22.6757
22.0533
21.4558
20.9368
19.2922
18.3321
17.4436
15.8568
14.4886
13.3034
12.2722
11.3711
10.5802
9.8832
9.2664
8.7184
25
24.2660
23.5629
22.8891
22.2434
21.6860
19.9139
18.8850
17.9355
16.2470
14.7986
13.5504
12.4693
11.5288
10.7066
9.9847
9.3481
8.7843
30
28.9400
27.9330
26.9759
26.0658
25.3049
22.8444
21.4535
20.1885
17.9837
16.1411
14.5907
13.2777
12.1584
11.1983
10.3696
9.6501
9.0218
35
33.5561
32.1955
30.9128
29.7027
28.7227
25.4986
23.7238
22.1318
19.4112
17.1929
15.3681
13.8540
12.5869
11.5178
10.6086
9.8293
9.1566
40
38.1149
36.3531
34.7053
33.1630
31.9531
27.9026
25.7303
23.8082
20.5845
18.0170
15.9491
14.2649
12.8786
11.7255
10.7570
9.9357
9.2330
50
47.0635
44.3635
41.8782
39.5881
37.9012
32.0521
29.0714
26.5017
22.3415
19.1687
16.7076
14.7668
13.2122
11.9482
10.9063
10.0362
9.3010
PRESENT VALUE OF ANNUITY DUE
(Annuity in advance - beginning of period paym
ents)
PERIODS
RATE PER PERIOD
0.25%
0.50%
0.75%
1.00%
1.50%
2.00%
2.50%
3.00%
4.00%
5.00%
6.00%
7.00%
8.00%
9.00%
10.00%
11.00%
12.00%
1
0.9975
0.9950
0.9926
0.9901
0.9852
0.9804
0.9756
0.9709
0.9615
0.9524
0.9434
0.9346
0.9259
0.9174
0.9091
0.9009
0.8929
2
1.9925
1.9851
1.9777
1.9704
1.9559
1.9416
1.9274
1.9135
1.8861
1.8594
1.8334
1.8080
1.7833
1.7591
1.7355
1.7125
1.6901
3
2.9851
2.9702
2.9556
2.9410
2.9122
2.8839
2.8560
2.8286
2.7751
2.7232
2.6730
2.6243
2.5771
2.5313
2.4869
2.4437
2.4018
4
3.9751
3.9505
3.9261
3.9020
3.8544
3.8077
3.7620
3.7171
3.6299
3.5460
3.4651
3.3872
3.3121
3.2397
3.1699
3.1024
3.0373
5
4.9627
4.9259
4.8894
4.8534
4.7826
4.7135
4.6458
4.5797
4.4518
4.3295
4.2124
4.1002
3.9927
3.8897
3.7908
3.6959
3.6048
6
5.9478
5.8964
5.8456
5.7955
5.6972
5.6014
5.5081
5.4172
5.2421
5.0757
4.9173
4.7665
4.6229
4.4859
4.3553
4.2305
4.1114
7
6.9305
6.8621
6.7946
6.7282
6.5982
6.4720
6.3494
6.2303
6.0021
5.7864
5.5824
5.3893
5.2064
5.0330
4.8684
4.7122
4.5638
8
7.9107
7.8230
7.7366
7.6517
7.4859
7.3255
7.1701
7.0197
6.7327
6.4632
6.2098
5.9713
5.7466
5.5348
5.3349
5.1461
4.9676
9
8.8885
8.7791
8.6716
8.5660
8.3605
8.1622
7.9709
7.7861
7.4353
7.1078
6.8017
6.5152
6.2469
5.9952
5.7590
5.5370
5.3282
10
9.8639
9.7304
9.5996
9.4713
9.2222
8.9826
8.7521
8.5302
8.1109
7.7217
7.3601
7.0236
6.7101
6.4177
6.1446
5.8892
5.6502
11
10.8368
10.6770
10.5207
10.3676
10.0711
9.7868
9.5142
9.2526
8.7605
8.3064
7.8869
7.4987
7.1390
6.8052
6.4951
6.2065
5.9377
12
11.8073
11.6189
11.4349
11.2551
10.9075
10.5753
10.2578
9.9540
9.3851
8.8633
8.3838
7.9427
7.5361
7.1607
6.8137
6.4924
6.1944
13
12.7753
12.5562
12.3423
12.1337
11.7315
11.3484
10.9832
10.6350
9.9856
9.3936
8.8527
8.3577
7.9038
7.4869
7.1034
6.7499
6.4235
14
13.7410
13.4887
13.2430
13.0037
12.5434
12.1062
11.6909
11.2961
10.5631
9.8986
9.2950
8.7455
8.2442
7.7862
7.3667
6.9819
6.6282
15
14.7042
14.4166
14.1370
13.8651
13.3432
12.8493
12.3814
11.9379
11.1184
10.3797
9.7122
9.1079
8.5595
8.0607
7.6061
7.1909
6.8109
16
15.6650
15.3399
15.0243
14.7179
14.1313
13.5777
13.0550
12.5611
11.6523
10.8378
10.1059
9.4466
8.8514
8.3126
7.8237
7.3792
6.9740
17
16.6235
16.2586
15.9050
15.5623
14.9076
14.2919
13.7122
13.1661
12.1657
11.2741
10.4773
9.7632
9.1216
8.5436
8.0216
7.5488
7.1196
18
17.5795
17.1728
16.7792
16.3983
15.6726
14.9920
14.3534
13.7535
12.6593
11.6896
10.8276
10.0591
9.3719
8.7556
8.2014
7.7016
7.2497
19
18.5332
18.0824
17.6468
17.2260
16.4262
15.6785
14.9789
14.3238
13.1339
12.0853
11.1581
10.3356
9.6036
8.9501
8.3649
7.8393
7.3658
20
19.4845
18.9874
18.5080
18.0456
17.1686
16.3514
15.5892
14.8775
13.5903
12.4622
11.4699
10.5940
9.8181
9.1285
8.5136
7.9633
7.4694
21
20.4334
19.8880
19.3628
18.8570
17.9001
17.0112
16.1845
15.4150
14.0292
12.8212
11.7641
10.8355
10.0168
9.2922
8.6487
8.0751
7.5620
22
21.3800
20.7841
20.2112
19.6604
18.6208
17.6580
16.7654
15.9369
14.4511
13.1630
12.0416
11.0612
10.2007
9.4424
8.7715
8.1757
7.6446
23
22.3241
21.6757
21.0533
20.4558
19.3309
18.2922
17.3321
16.4436
14.8568
13.4886
12.3034
11.2722
10.3711
9.5802
8.8832
8.2664
7.7184
24
23.2660
22.5629
21.8891
21.2434
20.0304
18.9139
17.8850
16.9355
15.2470
13.7986
12.5504
11.4693
10.5288
9.7066
8.9847
8.3481
7.7843
25
24.2055
23.4456
22.7188
22.0232
20.7196
19.5235
18.4244
17.4131
15.6221
14.0939
12.7834
11.6536
10.6748
9.8226
9.0770
8.4217
7.8431
30
28.8679
27.7941
26.7751
25.8077
24.0158
22.3965
20.9303
19.6004
17.2920
15.3725
13.7648
12.4090
11.2578
10.2737
9.4269
8.6938
8.0552
35
33.4724
32.0354
30.6827
29.4086
27.0756
24.9986
23.1452
21.4872
18.6646
16.3742
14.4982
12.9477
11.6546
10.5668
9.6442
8.8552
8.1755
40
38.0199
36.1722
34.4469
32.8347
29.9158
27.3555
25.1028
23.1148
19.7928
17.1591
15.0463
13.3317
11.9246
10.7574
9.7791
8.9511
8.2438
50
46.9462
44.1428
41.5664
39.1961
34.9997
31.4236
28.3623
25.7298
21.4822
18.2559
15.7619
13.8007
12.2335
10.9617
9.9148
9.0417
8.3045
PERIODS
PRESENT VALUE OF ORDINARY ANNUITY
(Annuity paid at the end of the period)
RATE PER PERIOD
