Accounting for pensions?

I have tried countless times and can't figure out this homework problem for my financial accounting class. Anyone help on doing this right would be greatly appreciated!





Under the NBA deferred compensation plan, payments made at the end of each year accumulate up to retirement and then retirees are given two options. Option 1 allows the retiree to select the amount of the annual payment to be received and option 2 allows the retiree to specify over how many years payments are to be received. Assume Rodman has had $6,000 deposited at the end of each year for 30 years, and that the long-term interest rate has been 8%.


Required:


a. How much has accumulated in Rodman's deferred compensation account?


b. How much will Rodman be able to withdraw at the beginning of each year if he elects to receive payments for fifteen years?


c. How many years will Rodman be able to receive payments if he chooses to receive $65,000 per year at the beginning of each year?|||You can solve these using the Future Value, PMT, and NPER functions in Excel, or using a financial calculator like the HP12C, or the Future Value of an Annuity tables in your book. The answers come out the same, regardless of the method you use. See answers below:





a. How much has accumulated in Rodman's deferred compensation account?





To solve, calculate the Future Value (of an annuity) using these criteria:





Payments = -$6,000


Rate = 8%


Number of Periods = 30





Future Value = $679,699.27





b. How much will Rodman be able to withdraw at the beginning of each year if he elects to receive payments for fifteen years?





Calculate Payment using these criteria:





Number of Periods = 15


Rate = 8%


Present Value = -$679,699.27


Type = 1 (in Excel this signifies that the payment is to be received at the beginning of the year)





Annual Payments = $73,526.81





c. How many years will Rodman be able to receive payments if he chooses to receive $65,000 per year at the beginning of each year?





Calculate Number of Periods using these criteria:





Rate = 8%


Present Value = -$679,699.27


Annual Payment = $65,000


Type = 1 (in Excel this signifies that the payment is to be received at the beginning of the year)





Number of Periods = 19.358