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4 years ago

What would be the future value of a saving account starting 700.00 earning four percent(compound annually) after 10 years?

Business

1 answer:

Kazeer [188]4 years ago

5 0

Let's use the formula for compounding interest.

F = P(1+i)^n

where

P is the present worth

i is the interest

n is the number of years

F is the future worth or future value

Substituting the values,

P = 700; i = 0.04; n = 10

F = 700 (1+0.04)^10

F = 1,036.71

Hence, after 10 years, the future value would be 1,036.71.

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3 years ago

A dealer persuades a customer to buy a new car by reducing the price to well below that of his competitors. Once the customer ha

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Answer:

low ball

Explanation:

From the question, we are informed about A dealer who persuades a customer to buy a new car by reducing the price to well below that of his competitors. Once the customer has agreed to buy the car, the terms of the sale are shifted by lowering the value of the trade-in and requiring the purchase of expensive extra equipment. Now the car costs well above the current market rate. In this case, This is an example of the low ball procedure. The low-balling procedure can be regarded as lpersuasion tactic whereby the seller offer will give an initial offer of goods/ service at a lower price than the expected price, so that the buyer can commit, after the commitment from buyer, the price will be suddenly increased. This technique is famous among salesmen as well as advertisers.

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3 years ago

Long-term assets that are useful in the operations of a business, are not held for sale, and are without physical qualities. Dur

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Solution and Explanation:

1 Amount of depletion, impairment and amortization for the current year

A Cost of timber rights on a tract of land $3,461,120

Estimated stand of timber 5,408,000

Cost of depletion per board feet (3461120 divided by 5408000) $0.64

Current year depletion charges for 1,028,300 board feet $658,112

B Impairment loss $3,640,000

C Cost of Patent $6,108,000

Estimated economic life 10 years

Amortization period 3/4

Amortization $(6108000 / 10 \text { year } \times 3 / 4)$ $458,100

2 Adjusting entries

Account Titles Debit Credit

a Depletion expense $658,112

Accumulated depletion $658,112

b Loss from Impaired Goodwill $3,640,000

Goodwill $3,640,000

c Amortization expense-Patents $458,100

Patents $458,100

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3 years ago

Quantitative Problem: Jenna is a single taxpayer. During 2018, she earned wages of $113,000. She doesn't itemize deductions, so

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Solution :

Item Amount

Income $113,000

Personal exemption for one $ 4,050

Standard deduction $ 6,350

Taxable income $102,600

Therefore the taxable income is $102,600.

Now the tax payable on the taxable income is given by :

Marginal tax rate Amount brackets

10% $0 - $ 9,325

15% $ 9,326 - $ 37,950

25% $ 37,951 -$ 91,900

28% $ 91,901 - $ 191,650

Now according to the above taxable slab, the amount of tax on the wages earned by Jenna is :

Tax payable = $= (0.1 \times 9325)+(0.15 \times (37950 - 9325))+(0.25 \times (91900 - 37950))+(0.28 \times (102600-91900))$ $= (0.1 \times 9325)+(0.15 \times 28625)+(0.25 \times 53950)+(0.28 \times 10700)$

= 932.5 + 4293.75 + 13487.50 + 2996

= $ 21,709.75

There is also a long term capital gain of $ 5,200 that is earned by selling the common stock.

Now as per IRS, the capital gain of a long term tax percentage for an individual single filer is in 28% tax slab category is 15%.

Therefore the tax on the capital gain of $ 5,200 is = 0.15 x 5200

= $780

Thus the total tax payable by Jenna is = $ 21,709.75 + $ 780

= $ 22,489.75

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3 years ago

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Ksenya-84 [330]

Answer:

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Explanation:

In this question, there is need to calculate cost of equity based on capital asset pricing model. Cost of equity is a function of risk-free rate plus beta multiplied by the difference between market return and risk free rate.

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4 years ago