1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
coldgirl [10]
3 years ago
12

Chris Bowie is trying to determine the amount to set aside so that he will have enough money on hand in 5 years to overhaul the

engine on his vintage used car. While there is some uncertainty about the cost of engine overhauls in 5 years, by conducting some research online, Chris has developed the following estimates.
Engine Overhaul Estimated Cash Outflow Probability Assessment
$300 10%
470 30%
740 50%
880 10%

How much รhould Chris Bowie deposit today in an account earning 6%, compounded annually, so that he will have enough money on hand in 3 years to pay for the overhaul?
Business
1 answer:
stealth61 [152]3 years ago
6 0

Answer:

$515.53

Explanation:

CALCULATION OF THE ESTIMATED CASH OUTFLOW EXPENSES FOR ENGINE OVERHAUL

Engine Overhaul                          Probability                 Estimated Cash

estimated cash outflow(X)                 (Y)                           flow ( X * Y)

$370                                             10%                                $37

$470                                             30%                               $141

$720                                             50%                               $360

<u>$760                                             10%                                $76</u>

<u>$2320                                                                                 $614</u>

Present Value Factor, PVF, of 3 years and 6% = 0.839619(from the table)

hence, value = $614 x 0.839619

                     = $515.53

Amount Deposited = $516 (approx)

<u />

You might be interested in
For the quarter ended March 31, 2017, Croix Company accumulates the following sales data for its newest guitar, The Edge: $316,7
erastovalidia [21]

Answer:

Explanation:

The preparation of ta static budget report for the second quarter is shown below:

                                          CROIX COMPANY

                                         Sales Budget Report

                             For the Quarter Ended June 30, 2017

                       Second Quarter                      Year to date

Product Line  Budget  Actual  Difference  Budget  Actual  Difference

New Guitar $383,500  $387,400 $3,900    $700,200 $690,500  $9,700

                                                      Favorable                             Unfavorable

The year to date balances are computed below:

For Budget:

= $383,500 + $316,700

= $700,200

For Actual:

= $387,400 + $690,500

= 690,500

6 0
3 years ago
Longview Hospital performs blood tests in its laboratory. The following standards have been set for each blood test performed:
Julli [10]

Answer:

Instructions are below.

Explanation:

Giving the following information:

Standard:

Direct materials 2.0 plates $2.75 per plate

Direct labor 0.2 hours $15.00 per hour

Variable manufacturing overhead 0.2 hours $7.00 per hour

Actual:

1,500 blood tests.

3,600 plates were purchased for $9,540

3,200 plates were used for blood tests

340 actual direct labor-hours were worked for $5,550

1)The materials price variance:

Direct material price variance= (standard price - actual price)*actual quantity

Direct material price variance= (2.75 - 2.65)*3,600= $360 favorable

2) The materials quantity variance:

Direct material quantity variance= (standard quantity - actual quantity)*standard price

Direct material quantity variance= (2*1,500 - 3,200)*2.75

Direct material quantity variance= $550 unfavorable

3) The labor rate variance:

Direct labor rate variance= (Standard Rate - Actual Rate)*Actual Quantity

Direct labor rate variance= (15 - 16.32)*340= $448.8 unfavorable

4) The labor efficiency variance:

Direct labor time (efficiency) variance= (Standard Quantity - Actual Quantity)*standard rate

Direct labor time (efficiency) variance= (1,500*0.2 - 340)*15

Direct labor time (efficiency) variance= $600 unfavorable

5) The variable overhead efficiency variance:

Variable overhead efficiency variance= (Standard Quantity - Actual Quantity)*Standard rate

Variable overhead efficiency variance= (1,500*0.2 - 340)*7

Variable overhead efficiency variance= $280 unfavorable

8 0
2 years ago
The general term for the payments for the use of resources is ______?
Zielflug [23.3K]
A. Wages is the general term for the payments for the use of resources
6 0
2 years ago
Joseph will start school on 9/1/14. He is expected to attend school for four years and will need to pay tuition of $50,000 on Se
My name is Ann [436]

Answer:

e. $153,156

Explanation:

From 9/1/14, he needs $50,000 every year for 4 years to fund the tuition fees. Therefore, present value of the amount needed at 9/1/14 using the Present value of annuity due formula

= 50,000 * {1+ (1/(1.05)^4) } / 0.05 * (1.05)

= $186,162

$186,162 is the amount needed after 4 years. Amount you need to invest today to have this amount in four years = $186,162/(1.05)^4 = $186,162/1.21550625 = $153,156.40

6 0
3 years ago
Welfare economics is the study of Select one: a. taxes and subsidies. b. how technology is best put to use in the production of
icang [17]

Answer:

Correct option is (d)

Explanation:

Welfare economics deals with the study of distribution of resources affect the overall welfare of the society and economy as a whole.

It is a part of economics that studies the role of government in aligning policies for the welfare of the society and ensuring that every section of the society is equally developed.

The concept was developed as inequality in distribution of wealth and resources was observed across different sections of the economy. Poor was becoming poorer and rich, becoming richer. This hampered overall growth of the economy, thereby giving birth to welfare economics.

7 0
3 years ago
Other questions:
  • A funding source that makes it easier for entrepreneurs to get money with favorable terms is referred to as:
    5·1 answer
  • The ability of marketers to identify customers before they make a purchase is
    5·1 answer
  • Which country has an absolute advantage for producing books
    10·1 answer
  • The manager of a bank branch is concerned about the number of mistakes the tellers were making, so he started manipulating diffe
    11·1 answer
  • Suppose an increasing number of school districts across the country find themselves with too few teachers at a time of rising en
    13·2 answers
  • When deciding on output levels, members of a cartel A. Set their output where MR=MC B. Produce the same level of output as if th
    10·1 answer
  • The Xu Corporation uses a periodic inventory system. The company has a beginning inventory of 950 units at $12 each on January 1
    7·1 answer
  • using the terms macroeconomics and microeconomics explain the economic relationship between a nation and the firms and household
    6·1 answer
  • One way to encourage the desired CSR behavior throughout the firm is to record expectations and the boundaries of acceptable beh
    9·1 answer
  • Select three things are included in a product requirements document.(more than one answer)
    10·2 answers
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!