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baherus [9]
3 years ago
10

William pays his $500 premium every 6 months for automobile insurance with collision coverage. His deductible is $750. William c

aused a minor accident that resulted in $700 of damages to his car and $1,100 of damages to the other car. William's car looks and drives fine and he chooses not to file a claim to repair his car. How much will William pay out-of-pocket to have the other car fixed?
Business
1 answer:
Aleks [24]3 years ago
4 0
I believe that William's deductible is only for damage to his car and that he won't have to pay out of pocket for the other car but will have to pay higher premiums in the future due to his being at fault in the accident at least that is what happened to me recently and it worked out that way according to the automobile insurance in British Columbia, Canada.
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Derrick Iverson is a divisional manager for Holston Company. His annual pay raises are largely determined by his division’s retu
almond37 [142]

Answer:

a. Project's net present value is $1,015,163.09

b. Simple rate of return is 15%

c. Yes. The reason is that the project has a positive net present value of $1,015,163.09.

d. No. The reason is that the simple rate of return of 15% obtained in part b is lower the division’s return on investment (ROI), which has been above 20% each of the last three years.

Explanation:

a. Compute the project's net present value.

To compute this, we first calculate the annual cash inflow as follows:

Annual cash inflow = Net operating income + Depreciation = $452,000 +  $828,000 = $1,,280,000

Now, the project's net present value can be calculated using the formula for calculating the present of an ordinary annuity as follows:

PV = P * [{1 - [1 / (1 + r)]^n} / r] …………………………………. (1)

Where;

PV = Present value of the annual cash flow = ?

P = Annual cash inflow = $1,280,000

r = Discount rate = 17%, or 0.17

n = Equipment useful years = 5

Substitute the values into equation (1) to have:

PV = $1,280,000 * [{1 - [1 / (1 + 0.17)]^5} / 0.17]

PV = $4,095,163.09

Project's net present value = PV - Project's initial investment = $4,095,163.09 - $3,080,000 = $1,015,163.09

b. Compute the project's simple rate of return

This can be computed as follows:

Simple rate of return = Net operating income / Initial investment =  $452,000 / $3,080,000 = 0.15, or 15%

c. Would the company want Derrick to pursue this investment opportunity?

Yes. The reason is that the project has a positive net present value of $1,015,163.09.

Note that had it been the net present value of the project was negative, the company would not want to Derrick to pursue this investment opportunity since the decision of the company is based on whether the project's NPV is positive or negative.

d. Would Derrick be inclined to pursue this investment opportunity?

No. The reason is that the simple rate of return of 15% obtained in part b is lower the division’s return on investment (ROI), which has been above 20% each of the last three years.

Pursuing this investment opportunity will therefore reduce the Overall ROI of the division and Derrick will not get annual pay raises if this happens.

8 0
3 years ago
Using the information presented above, determine the following: Determine EPS for Net Income ('x2) $_____________________ (Round
taurus [48]

Question Completion:

Income Before Taxes (from ongoing operations) $2,470,000

Income Tax Rate (’x2) 30%

5% Preferred Stock ($100 Par, 10,000 shares issued)

Common Stock ($1 par, 600,000 shares issued, 500,000 outstanding)

Answer:

The company's EPS is:

= 3.46

Explanation:

a) Data and Calculations:

Income Before Taxes (from ongoing operations) (’x2)= $2,470,000

Income Tax Rate (’x2) = (30% * $2,470,000) = $741,000

Net Income after taxes = $1,729,000

5% Preferred Stock ($100 Par, 10,000 shares issued) = $1,000,000

Common Stock ($1 par, 600,000 shares issued, 500,000 outstanding)

Outstanding common stock = $500,000

EPS (Earnings per share) = Net income after taxes/No. of outstanding shares

= $1,729,000/500,000

= $3.458

b) The earnings per share (EPS) equals Company A's net profit after taxes divided by the number of its outstanding common stock shares. Using the EPS, it indicates how much money Company A makes for each share of its stock.  As a widely used metric, a potential stockholder of Company A can use it to estimate Company A's value when combined with the price per share.

6 0
3 years ago
1. A creditor's claim to the property of an individual or business is called
skad [1K]

Answer:

c. liabilities.

Explanation:

liabilities are the creditors claims to the assets of the business/property.

7 0
2 years ago
How much federal tax is deducted from the paycheck.
jok3333 [9.3K]

Answer:

The standard deduction is a specific dollar amount that reduces your taxable income. For the 2021 tax year, the standard deduction is $12,550 for single filers and married filing separately, $25,100 for joint filers and $18,800 for head of household.

Explanation:

3 0
2 years ago
Solomon Ski Company manufactures snow skis. During the most recent accounting period, the company’s finishing department transfe
LiRa [457]

The various costs for Solomon Ski Company during the recent accounting period are determined as follows:

1. Cost per equivalent unit is <u>$65.</u>

2. Cost of finished goods transferred out from the finishing department is <u>$269,750</u>.

3. Cost of the ending WIP inventory is <u>$15,600</u>.

<h3>What is the cost per equivalent unit?</h3>

The cost per equivalent unit refers to the average cost per unit based on the total production costs divided by the total equivalent units of production.

The equivalent units of production depend on the degree or percentage of completion for the various cost classes.

<h3>Data and Calculations:</h3>

Transfer to finished goods = 4,150

Ending inventory = 480

Degree of completion of the ending inventory = 50%

Total equivalent units = 4,390 (4,150 + 480 x 50%)

Total production costs = $285,350

Cost per equivalent unit = $65 ($285,350/4,390)

Cost of finished goods = $269,750 ($65 x 4,150)

Cost of the ending WIP = $15,600 ($65 x 240)

Thus, equivalent units refer to the degree of work completed per unit.

Learn more about equivalent units of production at brainly.com/question/16259709

#SPJ1

7 0
1 year ago
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