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Digiron [165]
3 years ago
11

Ronen Consulting has just realized an accounting error that has resulted in an unfunded liability of $ 398 comma 930 due in 28 y

ears. Toni​ Flanders, the​ company's CEO, is scrambling to discount the liability to the present to assist in valuing the​ firm's stock. If the appropriate discount rate is 7 ​percent, what is the present value of the​ liability?
Business
1 answer:
Sladkaya [172]3 years ago
3 0

Answer:

Present value of Liability is $59,989

Explanation:

Money does not have the same value in future as it has today. The present value calculates the today's value of any that cash flow will be made in future.

Liability = FV = $398,930

Number of years = n = 28 years

Discount rate = r = 7%

Present value = FV / ( 1 + r )^n

Present value = $398,930 / ( 1 + 0.07 )^28

Present value = $398,930 / 6.65

Present value = $59,989.47

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While preparing a bank reconciliation, a bank service charge was discovered. This adjustment would be recorded with a?
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While preparing a bank reconciliation, a bank service charge was discovered. This adjustment would be recorded with a Credit to cash, debit to bank fees expense.

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7 0
1 year ago
People who make goods and services are called _____ . <br> consumers<br> producers<br> investors
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8 0
3 years ago
Read 2 more answers
If the Fed increases the discount rate, which of the following accurately describes the sequence of events that will follow in t
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As a result of this reduction in their Excess reserve, they will have less money to give out as loans. With less loans being made, people will not have as much money to deposit after taking the loans. Money supply will then fall as a whole.

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