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Schach [20]
1 year ago
6

Global Stores is downsizing and must let some employees go. Employees volunteering to leave are being offered a severance packag

e of $ 118,000 cash, another $ 129,000 to be paid in one year, and an annuity of $ 27,500 to be paid each year for six years with the first payment coming at the end of this year. What is the present value of the total severance package, assuming an annual interest rate of 5 % ?
Business
1 answer:
Deffense [45]1 year ago
8 0

Calculation of Present values of Severance pay                                

Cash Paid Now                                                                                   118000

Present value of the payment                         122857.02(129000*0.95238)    

made 1 year from now            

Present value of Annuity Pay                          139581.475 (27500*5.07569)

Present value                                                         380438

Employees often receive a severance pay at the end of their employment. This is usually based on the length of service the employee is entitled to upon retirement. The Fair Labor Standards Act (FLSA) does not require severance pay.

Some employers choose to provide severance pay to employees who have been dismissed involuntarily or voluntarily. The main reason for offering severance pay is to soften the blow of involuntary layoffs and avoid future lawsuits by having employees sign releases in exchange for severance pay.

Learn more about Severance pay at

brainly.com/question/27992969

#SPJ4

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Answer:

a. Groupo sells goods to MTN for $1,000,000, payment due at delivery.

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No journal entry is required until goods are delivered and accepted.

b. Groupo sells goods on account to Grifols for $800,000, payment due in 30 days.

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c. Groupo sells goods to Magnus for $500,000, payment due in two installments, the first installment payable in 18 months and the second payment due 6 months later. The present value of the future payments is $464,000.

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8 0
3 years ago
Blue Spruce Corp. started the year with total assets of $304000 and total liabilities of $244000. During the year the business r
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Answer:

$305,000

Explanation:

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Given that;

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3 0
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Answer: Option (C) is correct.

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