All categories

3 years ago

The present value of an annuity falls when interest rates rise

1 answer:

5 0

That is true, if you raise the rate then the present value falls.Of course, the present value will fall assuming the existence of positive cash flows. This annuity present value is divided into four pieces which are: the present value (PV), the periodic cash flow (C), the discount rate (r), and the number of payments, or the life of the annuity, (T).

You might be interested in

At the end of 2021, Larkspur Co. has accounts receivable of $653,700 and an allowance for doubtful accounts of $24,200. On Janua

Taya2010 [7]

Answer:

January 24, 2022, Madonna Inc.'c account is written off

Dr Allowance for doubtful accounts 4,245

Cr Accounts receivable 4,245

the cash realizable value of the accounts receivable account:

before the write off = $653,700 - $24,200 = $629,500
after the write off = ($653,700 - $4,245) - ($24,300 - $4,245) = $629,500

The net balance of the account does not change because the allowance for doubtful accounts is a contra asset account that already decreased the accounts receivable balance.

8 0

3 years ago

Suppose that a country bandcountry band called Only HereOnly Here has released its first CD with WantedWanted Records at an inte

Virty [35]

Answer:

The recording label should increase the production and distribution of Here band

Explanation:

In the given question it is stated that the Music stores can markup to the price of $17.99 with continued strong sales against the listed price of $14.99.

Now,

The markup price is the extra amount that is over the cost of product or the service.

Thus,

Here, the Markup will further increase the profit by $17.99 - $14.99 = $3

Hence,

The recording label should increase the production and distribution of Here band

8 0

3 years ago

Spin Cycle Architecture uses three activity pools to apply overhead to its projects. Each activity has a cost driver used to all

hammer [34]

Answer:

a. predetermined overhead rate for each activity

initial concept formation = $3,310 per Project Change

design = $3 per Square feet

construction oversight = $1,130 per Month

b. Classification

unit-level activities :

design

batch level activities :

initial concept formation

Product level activities :

design

Facility level activities :

initial concept formation

construction oversight

Explanation:

This question requires application of Activity Based Costing (ABC) method of allocating overheads.

For each overhead a rate is determined as follows :

initial concept formation

Predetermined overhead rate = Overhead Cost / Number of Project Changes

= $52,960/ 16

= $3,310 per Project Change

design

Predetermined overhead rate = Overhead Cost / Square feet

= $420,000/ 140,000

= $3 per Square feet

construction oversight

Predetermined overhead rate = Overhead Cost / Number of Months

= $118,650/ 105

= $1,130 per Month

Classification

The way the activity is to be absorbed in costing determine its classification

5 0

3 years ago

Change in supply or change in quantity supplied

xxMikexx [17]

Usually an increase in price means a decrease in supply and or a raise in demand. He quickly changes this by increasing the production, thus increasing the supply, lowering the prices.

Hope this helps,

Jeron

7 0

3 years ago

In his blog, Max Gladwell says that our world is being profoundly changed

Vesnalui [34]

Answer:

B: Increasing use of social media

Explanation:

Social media has many effects, good and bad on our society. Now people know what happened 4 minutes ago in countries thousands of miles away. They can keep up with celebrities and more. You can see how this is drastically changing the way we live. Hope this helps!

3 0

3 years ago