Answer:
Year 1 PV = 91,743.12
Year 2 PV =126,251.99
Year 3 PV = 154,436.70
Explanation:
<em>The present value of future sum is the amount that ought to be invested today at interest rate compounded annually to equal the sum at the end of a particular period.</em>
The present value of a future sum is given as follows:
PV = FV × PV (1+r)^(-n)
PV - present value
FV - Future value
r- interest rate
n- number of years
Year 1 PV = 100,000× 1.09^(-1) =91,743.12
Year 2 PV = 150,000× 1.09^(-2) =126,251.99
Year 3 PV = 200,000× 1.09^(-3) = 154,436.70
Answer:
C. $40,000
Explanation:
For computing the amount of the gain recognized, first we have to calculate the gain recognized based on the adjusted basis
= Cash received + fair market value of the stock - adjusted cash basis
= $40,000 + $60,000 - $35,000
= $100,000 -$35,000
= $65,000
But the cash is received for $40,000. So, only $40,000 of gain would be recognized. As in the case of transfer, if the amount is received other than the stock so the amount which is received is recognized as a gain i.e $40,000
Answer: The rate of return on common stockholder’s equity is 23%.
Explanation:
Given that,
Net Income = $50,000
Preferred Dividends = 8,000
Average Common Stockholder’s Equity = 180,000
Average number of Common Shares Outstanding = 250,000 shares
Market Price = $2 per share
Therefore,
Return on equity = 
= 
= 23%
Answer:
Option (B) is correct.
Explanation:
Given that,
Accounts receivables = $1,500,000
Allowance for doubtful accounts = $90,000
Expected uncollectibles = $125,000
The collection of accounts receivables after the adjustment for bad debt expense is determined by deducting the expected uncollectibles from the total amount of accounts receivables.
Accounts receivable amount expected to be collected after adjustment for bad debt expense:
= Accounts receivables - Expected uncollectibles
= $1,500,000 - $125,000
= $1,375,000
Answer:
$27,900
Explanation:
The computation of adjusted cash balance is shown below:-
Adjusted cash balance = Balance at May 31 - bank service fees - NSF check
= $28,525 - $25 - $600
= $27,900
Therefore for computing the adjusted cash balance we simply deduct the bank service fee and NSF check from balance at may 31
Hence, the adjusted cash balance is $27,900
