Correct Answer - Option 2 : Rs. 94,929
Concept:
As per sinking found method, Further work of money is given as:
\(F = A\left( {\frac{{{{\left( {1 + i} \right)}^N} - 1}}{i}} \right)\)
Where ‘F’ is future work i.e. Amount available to owner after 25 tears.
‘A’ is annual amount which is being sets aside as sinking fund by owner every year.
i → rate of interest
N → Period considered.
Calculation:
Given:
N = 25 tears, A = Rs. 1500 /-
i = 7%
\(F = 1500 \times \left[ {\frac{{{{\left( {1 + .07} \right)}^{25}} - 1}}{{.07}}} \right]\)
\(F = 1500 \times \left[ {\frac{{5.43 - 1}}{{.07}}} \right]\) = Rs. 94,929/-