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Shtirlitz [24]
3 years ago
6

You wish to retire in 15 years, at which time you want to have accumulated enough money to receive an annual annuity of $31,000

for 20 years after retirement. During the period before retirement you can earn 12 percent annually, while after retirement you can earn 14 percent on your money. What annual contributions to the retirement fund will allow you to receive the $31,000 annuity?
Business
1 answer:
kupik [55]3 years ago
5 0

Answer:

$ 5,507.47

Explanation:

There are two steps involved in solving this question ,first we need to determine the present of annuity of $31,000 receivable per year after retirement  at retirement date,then use that to calculate the annual contribution:

=-pv(rate,nper,pmt,fv)

rate is the rate of interest during retirement which is 14%

nper is the period during which the $31000 would be received which is 20

pmt is the $31000 annuity per year

fv is the future worth of the annuity which is unknown

=-pv(14%,20,31000,0)=$ 205,317.05  

The present value above is the future value of the retirement contributions

annual contribution=pmt(rate,nper,pv,-fv)=pmt(12%,15,0, 205317.05) =$ 5,507.47

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Finger [1]

Answer:

The journal entry is as follows:

Explanation:

January 5       Patent A/c..................Dr        $100,000

                             To Cash A/c............Cr           $100,000

As patent is purchased so asset is increasing and any increase in asset would be debited. Therefore, patent account is debited. And it is purchased against cash and decrease in asset is credited. Therefore, cash account is credited.

December 31    Amortization expense- Patent................Dr                $5,000

                                    To Accumulated Amortization- Patent........Cr      $5,000

Working Note:

Patent Cost is $100,000

Useful life is 20 years

Amortization expense = Patent Cost / Useful life of asset

                                     = $100,000 / 20

                                     = $5,000

7 0
3 years ago
Outstanding stock of the Marin Corporation included 54000 shares of $5 par common stock and 20000 shares of 5%, $10 par non-cumu
inn [45]

Answer:

The amount of dividends distributed to preferred stockholders in 2017 is $10000.

Explanation:

The preferred stock is non cumulative which means that if the company is unable to pay dividends on preferred stock in a certain year, the dividend for that year will not be accumulated and will not be paid in the next year.

Thus, the company only paid a dividend of $2700 in 2016 and the remaining dividends will not be payable by the company in year 2017.

The dividend on each share of preferred stock per year is = 10 * 0.05 = $0.5 per share

The number of shares of preferred stock are 20000.

The total dividends that will be paid to preferred stock holders in 2017 is = 0.5 * 20000 = $10000

Thus, out of the $27000 dividends of 2017, $10000 was distributed to preferred stockholders.

8 0
3 years ago
A firm sells a product in a purely competitive market. The marginal cost of the product at the current output of 200 units is $4
posledela

Answer:

D. Should Shut Down

Explanation:

A perfect competition firm is at profit maximising equilibrium where : Marginal Revenue [Price] = Marginal Cost .

If MR > MC : Firm's additional production is profitable, it tends to increase production. If MR < MC : Firm's additional production is loss making, it tends to decrease production.

However, If firm's Price i.e MR < Average Variable Cost : The firm's per unit price is even unable to cover it's per unit average variable cost. This situation is referred to as 'Shut Down' point & firm should close down its production in the case.

Given : MR = P = 3 ; MC = 4 ; AVC = 3.5 . The firm's price P (3) is not only lesser by its Marginal Cost MC (4), to decrease production ; but also lesser than its Average Variable Cost AVC (3.5) . So, the firm should shut down.

7 0
3 years ago
What is first step in developing a knowledge management system
Elza [17]
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hope this helps :)
5 0
3 years ago
Shareholders of mutual funds have all of the following rights EXCEPT: A) the right to vote on the selection of specific securiti
trapecia [35]

Answer:

you do not obtain the right to vote on the selection of specific securities for the portfolio

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As a shareholder of a mutual fund you have many rights available such as voting proxies, receiving semiannual reports, and voting rights. Unfortunately, you do not obtain the right to vote on the selection of specific securities for the portfolio. The only individual that can make this decision is the fund manager. This individual is the one that analyzes different securities and chooses the ones that will round out and diversify the mutual fund nicely while at the same time maximizing ROI potential.

5 0
3 years ago
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