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yawa3891 [41]
3 years ago
13

On January 1, Snipes Construction paid for earth-moving equipment by issuing a $320,000, 3-year note that specified 4% interest

to be paid on December 31 of each year. The equipment’s retail cash price was unknown, but it was determined that a reasonable interest rate was 7%. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.)
what amount should Snipes record the equipment and the note?
Business
1 answer:
kvv77 [185]3 years ago
6 0

Answer:

$294,803.84

Explanation:

The computation of the equipment and the note is shown below:

Rate = 7% and the time = 3 years

Cash flow                Table Value Amount        Present Value

Par (Maturity) Value 0.81629       $320,000        $261,212.80

Interest (Annuity)

($320,000 × 4%)          2.6243    $12,800                $33,591.04

Price of equipment                                  $294,803.84

The 0.81629 is

= 1 ÷ 1.07^3

And, the 2.6243 is the PVIFA factor

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we are evaluating a project that costs $848,000, has an eight-year life, and has no salvage value. assume that depreciation is s
alukav5142 [94]

A project's susceptibility to undesirable fluctuations in the value of the underlying factors, such as the sales price, sales units, its indirect cost, and other variables, is assessed using sensitivity analysis.

<h3>Sensitivity analysis: What is it?</h3>

According to a specific set of assumptions, sensitivity analysis evaluates how various values of an exogenous variables impact a specific dependent variable. In other words, analyses look at how different types of ambiguity in a mathematical formula affect the overall level of uncertainty in the model.

<h3>Briefing:</h3>

Project has an eight-year lifespan, costs $848,000, and has no residual value. Over the course of the project's life, depreciation decreases linearly to zero.

Depreciation = $848,000 / 8 = $106,000

Contribution margin per unit = selling price - variable cost per unit

= 40 - 20 = $20 per unit

Accounting break-even point = (Fixed costs + Depreciation) / Contribution per unit

= (625,000 + 106,000) / 20

= 36,550 units

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1 year ago
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5 0
2 years ago
A real estate salesperson brings a buyer to a For-Sale-By-Owner transaction. The home sells for $120,000, and the seller agrees
sweet [91]

Solution:

The home sells for = $120000

The commission that is paid by the seller is 3 percent

Therefore, commission = 3% of $120000 = $3600

The sales-person is on a 65 percent commission schedule with her broker which means that the saleperson gets the 65 percent amount of the commission.

Thus, the amount which is received by the salesperson from the given transaction is = 65% of $3600 = $2340

Therefore, the salesperson receives $2340 amount from the said transaction.

8 0
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inna [77]

Answer:

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Although, prepaid insurance will be shown as paid within the year, it must be deducted from the insurance premium paid for the current year and then reported in the balance sheet as a current asset.

Prepaid insurance is treated as a current asset because it is an indication of insurance premiums paid for by the company in advance. It is a payment for economic benefits that will be enjoyed in the future, therefore it is a current asset. The only part of an insurance premium that shows in the income statement is the insurance expense paid for insurance benefit enjoyed in the current period

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3 years ago
Does the market system result in allocative​ efficiency? in the long​ run, perfect competition
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C.

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