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3 years ago

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When you retire you expect to live for another 30 years. During those 30 years you want to be able to withdraw $4,000 at the beg

inning of every month for living expenses. How much money do you have to have in your retirement account to make this happen

1 answer:

lions [1.4K]3 years ago

3 0

You would need $1,440,000

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Machinery purchased for $64,200 by Sheridan Co. in 2016 was originally estimated to have a life of 8 years with a salvage value

ArbitrLikvidat [17]

Answer:

Sheridan Co.

a. It is not necessary to correct the prior year's depreciation. Depreciation is an accounting estimate and does not require the adjustment of prior year's accounts when there is a correction in its estimates.

b. Entry to record depreciation for 2021:

Debit Depreciation Expense $4,387

Credit Accumulated Depreciation $4,387

To record the depreciation expense for the year.

Explanation:

a) Data and Calculations:

Purchase of machinery in 2016 = $64,200

Original estimated useful life = 8 years

Salvage value = $4,280

Depreciation amount = $59,920 ($64,200 - $4,280)

Depreciation expense per year = $7,490 ($59,920/8)

Accumulated depreciation for 5 years = $37,450

Net book value = $26,750 ($64,200 - $37,450)

Remaining estimated useful life = 5 years

Salvage value = $4,815

New depreciable amount = $21,935 ($26,750 - $4,815)

Depreciation expense per year = $4,387 ($21,935/5)

4 0

3 years ago

Last year Aft charged $2,946,667 Depreciation on the Income Statement of Andrews. If early this year Aft purchased a new depreci

Kisachek [45]

Answer:

Decrease in Bank balance and increase in fixed assets

Explanation:

When a new depreciable asset is purchased, the money leaves the bank account hence reducing the bank balance in the statement of financial position, and on the other hand the 'Fixed asset' balance will rise by the same amount; recognizing the addition to the assets of the company. In this scenario the balance sheet totals remain unchanged as the same amount has been subtracted from 'bank' and added to 'fixed assets' all within the asset side.

However, if the asset is debt financed, it will increase the long term liability figure because 'bank loan' will be recognized. Hence the totals of the balance sheet will rise by the amount of the loan on the 'Capital and liabilities' side and the amount of the asset on the 'Asset' side.

Another impact is that the amount of depreciation charged to the Income Statement will be higher than $2,946,667 which was charged in the previous year because the new asset's depreciation will have to be added.

3 0

3 years ago

CVP analysis—what-if questions; sales mix issue Miller Metal Co. makes a single product that sells for $32 per unit. Variable co

Lilit [14]

Answer: See explanation

Explanation:

a. Calculate the number of units that must be sold each month for the firm to break even.

Breakeven units = Fixed cost / Contribution margin per unit

= $47600 / ($32 - $20.80)

= $47600 / $11.20

= 4250 units

b. Calculate the margin of safety and the margin of safety ratio.

Margin of safety = $418000 - ($32 × 4250)

= $418000 - $136000

= $282000

Margin of safety ratio = $282000/$418000 = 0.68

c. Calculate operating income if 7,000 units are sold in a month.

= [($32 - $20.80) × 7000] - $47600

= $78400 - $47600

= $30800

d. Calculate operating income if the selling price is raised to $47 per unit, advertising expenditures are increased by $8,000 per month, and monthly unit sales volume becomes 7,600 units.

Sales = 7600 × $47 = $357200

Less: Variable cost at $20.8 = $158080

Contribution = $199120

Less: Fixed cost = $47600

Less: Advertising expense = $8000

Operating income = $143520

3 0

3 years ago

This shop is a sole trader and needs to obtain finance in order for the business to continue trading. Explain

nata0808 [166]

Answer:

see below

Explanation:

1. Personal Savings

The sole trader can invest his savings into his business for expansion. A sole trader who is confident about his business's prospects will be prepared to invest additional savings into the business for growth. The use of savings relieves them from the strain of interest payments and enables them to retain full control over the business.

2. Sale of Assets

Should a sole trader require funds to expand their business, they opt to dispose of some of their assets. If the trader does not have savings or retained earnings and have a property registered in their name, they may decide to sell it to raise capital.

7 0

3 years ago

Suppose that a young couple has just had their first baby and they wish to insure that enough money will be available to pay for

tankabanditka [31]

Answer:

$97,331.30

Explanation:

To calculate the amount available on the daughter's 18th birthday the following should be taken into cognisance

First, the yearly deposit increases by 5% every year, therefore year one is $2,000 but year 2 is $2,000 x1.05= $2,100 and continuing like that.

Secondly, the total deposit pre year is calculated as annual deposit for the year (1+interest rate)∧year on a descending basis.

It is therefore as follows;

Years Annual deposit Total value of deposit including interest

1 $2,000.00 $2,000(1+0.07)∧17= $6,317.63

2 $2,100.00 $2,100(1+0.07)∧16= $6,199.54

3 $2,205.00 $2,205(1+0.07)∧15=$6,083.66

4 $2,315.25 $2,315.25(1+0.07)∧14=$5,969.95

5 $2,431.01 $2,431.01(1+0.07)∧13=$5,858.36

6 $2,552.56 $2,552.56(1+0.07)∧12=$5,748.86

7 $2,680.19 $2,680.19(1+0.07)∧11=$5,641.41

8 $2,814.20 $2,814.20(1+0.07)∧10=$5,535.96

9 $2,954.91 $2,954.91(1+0.07)∧9=$5,432.48

10 $3,102.66 $3,102.66(1+0.07)∧8=$5,330.94

11 $3,257.79 $3,257.79(1+0.07)∧7=$5,231.30

12 $3,420.68 $3,420.68(1+0.07)∧6=$5,133.52

13 $3,591.71 $3,591.71(1+0.07)∧5=$5,037.56

14 $3,771.30 $3,771.30(1+0.07)∧4=$4,943.40

15 $3,959.86 $3,959.86(1+0.07)∧3=$4,851.00

16 $4,157.86 $4,157.86(1+0.07)∧2=$4,760.33

17 $4,365.75 $4,365.75(1+0.07)∧1=$4,671.35

18 $4,584.04 $4,584.04(1+0.07)∧0=$4,584.04

Total $56,264.77 $97,331.30

5 0

3 years ago