FDNBUSM 05 · Sinking Funds and Funding Schedules — Hard Exam
Conventions
Independent original practice cases. Amounts are Philippine pesos (PHP); enter numeric answers without currency symbols. Use the stated interest and payment timing. j is a nominal annual rate, i an effective payment-period rate, n the number of payments, and t years. Payment and compounding periods coincide unless stated otherwise. The factors are a(i,n) = [1 − (1 + i)^−n]/i and s(i,n) = [(1 + i)^n − 1]/i; at i = 0 both equal n. Keep full calculator precision and round money to 2 decimals only at the end; numeric money tolerance is PHP 0.02. Percentage answers are in percent, not decimal form. Report percentage and fractional-period/year answers to at least four decimal places unless exact; whole payment-count answers remain integers. Ignore taxes, fees and rounding of actual bank installments unless explicitly given. The Week 8 syllabus lists Annuities and Sinking Funds for Quiz 2; an exact calendar date was not verified.
Questions
01A fund must reach PHP 900,000 in three years. It makes quarter-end deposits and earns 8% nominal compounded quarterly. Find each deposit.
- PHP 75,000.00
- PHP 65,787.88
- PHP 67,103.64
- PHP 85,103.64
02A fund targeting PHP 900,000 in 12 quarters at 2% quarterly starts with PHP 120,000 now. What equal quarter-end deposit is required?
- PHP 60,048.87
- PHP 55,756.49
- PHP 58,156.49
- PHP 67,103.64
03A fund has PHP 48,000 immediately after the previous deposit. It earns 2% this quarter and receives PHP 6,500 at quarter end. What is its closing balance?
- PHP 55,460
- PHP 55,590
- PHP 54,500
- PHP 48,960
04A business owes PHP 500,000 in five years, paying 6% annual debt interest. A separate fund earns 4% and gets five year-end deposits. What combined annual cash amount funds interest and reserve?
- PHP 92,313.56
- PHP 118,698.20
- PHP 130,000.00
- PHP 122,313.56
05Immediately after quarter 8, a reserve contains PHP 200,000. Target is PHP 600,000 at quarter 20, and future yield is 2% quarterly. What new quarter-end deposit over the remaining term is required?
- PHP 12,462.69
- PHP 44,735.76
- PHP 25,823.84
- PHP 29,823.84
06A PHP 5,000 ordinary deposit at quarter 6 is missed. The target date is quarter 12 and the yield is 2% quarterly. What is the target-date shortfall?
- PHP 4,439.86
- PHP 5,630.81
- PHP 5,000.00
- PHP 6,341.21
07An ordinary annual fund targets PHP 100,000 after four deposits at 5%. Using unrounded theoretical deposits, how much total interest does it earn?
- PHP 7,195.27
- PHP 92,804.73
- PHP 20,000.00
- PHP 1,160.06
08A sinking fund at 5% has an actual balance of PHP 75,000 just after the penultimate year-end deposit. Target next year is PHP 100,000. What adjusted final deposit hits the target exactly?
- PHP 25,000
- PHP 20,000
- PHP 23,750
- PHP 21,250
09Which statement distinguishes an ordinary sinking fund from an installment loan?
- The fund deposit reduces the lender principal each period.
- Both always use P/a(i,n) regardless of target date.
- The fund solves future value of deposits; the loan solves present value of repayments.
- The fund always uses a higher interest rate.
10A reserve needs PHP 300,000 in five years. It earns 4% annually and makes five deposits at years 0–4. What is each deposit if the target is measured at year 5?
- PHP 67,388.13
- PHP 53,257.82
- PHP 55,388.13
- PHP 60,000.00