Answer:
The company will save 16 million dollar per year (till 5 years).
Explanation:
The saving can be easily calculated by subtracting tax paid after charging depreciation from tax paid if no depreciation is charge.
Tax Paid if no depreciation is charge
= $ 50 * 40% = $ 20 Million -A
Tax Paid if depreciation is charge
= ($ 50- $ 40") * 40% = $ 4 Million -B
" 200/5 =40
Tax saving = A-B = $ 16 Million per year
Answer:
When interest rate changes, it will cause a movement along the investment demand curve.
Explanation:
This is because the relation between interest rate and investment is similar to that between product and price (interest rate is price to purchase investment). The quantity of investment demanded is negatively related to the value of interest rate in the market. When the interest rate increases (price increases), the demanded quantity of investment decreases as they have to pay more for investment.
Answer:
The differential loss from the lease alternative would be -$69,900
Explanation:
In order to calculate the differential income or loss from the lease alternative we would have to make the following calculations:
Alternative I ( Sale) Alternative II ( Lease)
Sale proceeds net of commission $354,900
Total lease rentals $515,000
Property taxes and insurance ($230,000)
Net proceeds $354,900 $285,000
Difference loss from the lease alternative would be - $69,900
The differential loss from the lease alternative would be -$69,900
Solution :
It is given that :
Amount of investment or the principle amount , P = $ 100
Time of investment , t = 6 years
Rate of interest compounded annually r = 6 %
Therefore the future amount of this investment in a 6 year time is given by,
Therefore, after 6 years the investment of $ 100 will give an amount of $ 141.
Answer:
On average, it takes customers 47 days to pay their bills.
Explanation:
Please find the below for detailed explanation and calculations:
Fisher's Furniture Store's annual credit sell = Monthly credit sales x 12 = $1,230,000 x 12 = $14,760,000;
Fisher's Furniture Store's account receivables turnover ratio = Annual Credit Sales / Average account Receivables = $14,760,000 / $1,900,000 = 7.77 times;
The average time it takes customers to pay ( in days) = Receivable turnover in days = 365 / The account receivables turnover ratio = 365/ 7.77 = 47 days
Thus, the answer is 47 days.
