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Financial Accounting

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Calculation of Annuity

FINACT-JEITNC

Vultus Company needs to pay cash maintenance fee \$1,000 at the end of each year for the next five years. What is the present value of this annuity of maintenance contract if the interest rate is 10%?

A

\$5,000

B

\$3,791

C

\$5,500

D

\$4,682