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ycow [4]
3 years ago
10

Assume Royal Palm Corp., an equipment distributor, sells a piece of machinery with a list price of $800,000 to Arch Inc. Arch In

c. will pay $850,000 in one year.
Royal Palm Corp. normally sells this type of equipment for 90% of list price.

How much should be recorded as revenue?
a. $720,000.b. $765,000.c. $800,000.d. $850,000.
Business
1 answer:
Alexandra [31]3 years ago
3 0

Answer:

a. $720,000

Explanation:

Since in the question, it is given that the equipment is sold at the list price

The list price is $800,000 and the selling percentage is 90%

So, the revenue should be recorded

= List price × selling percentage

= $800,000 × 90%

= $720,000

Simply we multiplied the list with the selling percentage so that the correct amount can come

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Read 2 more answers
You have just won the lottery and will receive $460,000 in one year. You will receive payments for 27 years, and the payments wi
Zepler [3.9K]

Answer:

The present Value of my winnings = $4,578,716.35

Explanation:

An annuity is a series od annual cash outflows or inflows which payable or receivable for a certain number of periods. If the annual cash flow is expected  to increase by a certain percentage yearly, it is called a growing annuity.

To work out the the present value of a growing annuity,

we the formula:

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(1-  (1+g/1+r)^n

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=0.8958

PV = A/(r-g) ×  (1-  (1+g/1+r)^n)

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