Calculator Problem – 12/15/2014

You sell a property for $140,000 that you purchased for $65,000 for cash three years earlier.  What was the return (monthly compounding) on your invested capital?

(The answer will be posted with the new calculator problem in 2 weeks. Or if you can’t wait that long, you can go to https://www.facebook.com/garyjohnstonseminars for the answer.)

Answer for 12/01/2014 problem:
(N=120,I=8,PV= -500,000,PMT=0) FV=   $1,109,820.12
(N=120,I=4.5,PV= -500,000,PMT=0) FV=$   783,496.39
$   326,323.73

Calculator Problem – 11/03/2014

A tractor company is offering $0 down and 0% financing for 60 months.  If the tractor costs, $16,618 and your cost of capital is 10%, what is the equivalent cash price today?

(The answer will be posted with the new calculator problem in 2 weeks. Or if you can’t wait that long, you can go to https://www.facebook.com/garyjohnstonseminars for the answer.)

Answer for 10/20/2014 problem:

(N=360,I=4,PV=100,000,FV=0) PMT=$477.42
(N=360,I=5,PV=100,000,FV=0) PMT=$536.82
$ increase                                               $  59.40
% increase = $59.40 / $477.42 = 12.44%

Calculator Problem – 10/06/2014

You sell a property for $140,000 that you purchased for $65,000.  You choose to 1031 exchange the proceeds instead of paying capital gain taxes today at the rate of 34%.  If you invested the money you would have paid in taxes for 30 years at 12%, how much money would you have?

(The answer will be posted with the new calculator problem in 2 weeks. Or if you can’t wait that long, you can go to https://www.facebook.com/garyjohnstonseminars for the answer.)

Answer for 09/22/2014 problem:

(I=15,PV=0,PMT= -100,FV=100,000) N= 209.51

Calculator Problem – 09/22/2014

How long would it take you to create a $100,000 nest egg, if you invest $100 a month at 15%?

(Internalize the difference between this answer and the 09/08/2014 problem.)

(The answer will be posted with the new calculator problem in 2 weeks. Or if you can’t wait that long, you can go to https://www.facebook.com/garyjohnstonseminars for the answer.)

Answer for 09/08/2014 problem:

(I=12,PV=0,PMT= -100,FV=100,000) N=240.99 months