Question

E9-23 Computing Future values: Deposit Required and Accounting for a single-Sum Savings Account LO9-7, FUTURE VALUES On January 1, Alan King decided to deposit S58,800 in a savings account that will provide funds four years later to send his son to college. The savings account will carn 8% annually. Any interest earned will be added to the fund at year-end (rather than withdrawn). Required (show computations and round to the nearest dollar). 1. How much will be available in four years? 2. Provide the journal entry that Alan should make on January 1. 3. What is the total interest for the four years 4. Provide the journal entry that Alan should make on (a) December 31 of the first year and (b) December 31 of the second year.