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allsm [11]
3 years ago
15

You are trying to decide whether to repaint your house or install vinyl siding. The vinyl siding will cost $13,000 today and wil

l last 25 years. Painting your house will cost $3,500 today. However, a paint job only lasts 5 years. Additionally, there will be some weather damaged boards that need replacing if you choose to paint. Replacing the boards will cost $1,000, last 5 years as well. If you keep your money in a bank account that earns 10% (EAR), would you prefer to paint or install the siding
Business
1 answer:
emmasim [6.3K]3 years ago
4 0

Answer:

we will find present value of cost over 25 years for both alternatives and would choose one which lowest PV of cost.

Vinyl siding

Cost today (start of year 1) = PV = $13,000

It will last for 25 years

Painting:

Start of year 1:

Cost Incurred today = $3,500

Cost of replacing the boards today (which will last for 25 years) = $2,500

Start of year 6:

Cost Incurred at start of year 6 = $3,500 * (1 + 5%) 5 Annual Inflation rate being 5%

PV of this cost = $3,500 * (1 + 5%) 5 / (1 + 10%) 5

Start of year 11:

Cost Incurred at start of year 11 = $3,500 * (1 + 5%) 10

PV of this cost = $3,500 * (1 + 5%) 10 / (1 + 10%) 10

Start of year 16:

Cost Incurred at start of year 16 = $3,500 * (1 + 5%) 15

PV of this cost = $3,500 * (1 + 5%) 15 / (1 + 10%) 15

Start of year 21:

Cost Incurred at start of year 21 = $3,500 * (1 + 5%) 20

PV of this cost = $3,500 * (1 + 5%) 20 / (1 + 10%) 20

Total PV of all costs = 3500 + 2500 + 3500 * (1 + 5%) 5 / (1 + 10%) 5 + 3500 * (1 + 5%) 10 / (1 + 10%) 10 + 3500 * (1 + 5%) 15 / (1 + 10%) 15 + 3500 * (1 + 5%) 20 / (1 + 10%) 20

= $14,093.94

As such PV of cost Vinyl siding is lower at $13,000 than the PV of cost at $14,093.94 in case of painting.

Thus, you would prefer to install the vinyl siding

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The aspect of business ethics that examines business institutions from a social rather than an individual perspective is referre
MakcuM [25]

Answer: Corporate Cultural Responsibility.

Explanation:

The corporate cultural responsibility of a company are the standards members of the society have come to expect from the company based on the previous ways their members of staff have been seen to operate. Corporate Cultural responsibility can be seen in staff dress-code and work style.

6 0
3 years ago
Watson Company has monthly fixed costs.. Watson Company has monthly fixed costs of $91,000 and what dollar amount of sales must
asambeis [7]

Answer:

Instructions are listed below.

Explanation:

Giving the following information:

Watson Company has monthly fixed costs of $91,000.

Contribution margin ratio= 0.40

To calculate the dollar amount of sales, we need to use the following formula:

Break-even point (dollars)= (fixed costs + desired profit)/ contribution margin ratio

Break-even point (dollars)= 91,000/0.4= 227,500

A) Desired profit= 15,800

Break-even point (dollars)= (91,000 + 15,800) / 0.40= 267,000

B) Desired profit= 267,000

Break-even point (dollars)= (91,000 + 267,000) / 0.40= 895,000

C) Desired profit= 106,800

Break-even point (dollars)= (91,000 + 106,800) / 0.40= 494,500

D) Desired profit= 227,500

Break-even point (dollars)= (91,000 + 227,500) / 0.40= 796,250

5 0
3 years ago
On March 31, 2021, M. Belotti purchased the right to remove gravel from an old rock quarry. The gravel is to be sold as roadbed
fenix001 [56]

Answer:

$33,840

Explanation:

The computation of the depreciation per units or tons under the units-of-production method is shown below:

= (Original cost - residual value) ÷ (estimated tons)

= ($158,400 - $0) ÷ (22,000 tons)

= ($158,400) ÷ (22,000 tons)

= $7.20 per tons

Now for the year 2021, it would be

= Tons during 2021 × depreciation per tons

= 4,700 × $7.20 per tons

= $33,840

5 0
3 years ago
Marketing News is a magazine from the American Marketing Association that covers all aspects of the marketing industry. It is ma
KatRina [158]

Answer:

Vertical publication

Explanation:

Vertical publication are those types of publications where the editorial content is majorly focused on one type of industry or business. They are similar to trade magazines. In this case, the publication is concerned and majorly focused on marketing industry, hence why we refer to it as a vertical publication. They are publications usually written to benefit a particular business, industry or profession.

3 0
3 years ago
Read 2 more answers
Describe how you would transition to another career of your choice. Be sure to includes reference to how
Bezzdna [24]
<h2>My suggestion is to read the job description which you want to apply and compare the present responsibilities and edit the resume as needed.</h2>

Explanation:

To list out the responsibilities the following might be helpful:

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To list out the skill and attitude:

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