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Vinil7 [7]
3 years ago
6

Your friend Harold is trying to decide whether to buy or lease his next vehicle. He has gathered information about each option b

ut is not sure how to compare the alternatives. Purchasing a new vehicle will cost $33,500, and Harold expects to spend about $1,200 per year in maintenance costs. He would keep the vehicle for five years and estimates that the salvage value will be $13,300. Alternatively, Harold could lease the same vehicle for five years at a cost of $4,355 per year, including maintenance. Assume a discount rate of 12 percent. Required: 1. Calculate the net present value of Harold’s options. (Future Value of $1, Present Value of $1, Future Value Annuity of $1, Present Value Annuity of $1.) (Use appropriate factor(s) from the tables provided. Negative amounts should be indicated by a minus sign. Round your final answers to 2 decimal places. Do not round intermediate calculations.) 2. Advise Harold about which option he should choose. Lease Option Purchase Option
Business
1 answer:
Hoochie [10]3 years ago
5 0

Answer :

Net present value = -$30,284.90

Net present value = -$15,699.78

Explanation :

As per the data given in the question,

Particulars                 Amount     Factor              Purchase

Cost of new vehicle -$33,500    1                    -$33,500.00

Annual Maintenance -$1,200   3.605             -$4,326.00

Less : Salvage value    $13,300 0.567              $7,541.10

Net Present value                                             -$30,284.90

Particulars                  Amount       Factor           Purchase

Cost of new vehicle       $0                1                      $-

Annual Maintenance -$4,355       3.605          -$15,699.78

Less : Salvage value        $0             0.567              $-

Net Present value                                               -$15,699.78

We simply multiplied the amount with the factor so that the purchase amount could come

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Involuntary unemployment occurs when the wage rate is below the equilibrium wage rate. exists when there is an excess quantity o
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Answer:

exists when there is an excess quantity of labor supplied.

Explanation:

Involuntary unemployment is the situtation in which the labor actually work and also work at the prescribed wage rate in that time when the job is not getting

It could be arise when there is a lacking of the aggregate demand or total demand also when there is a excess of labor supply

so according to the given situation, the second option is correct

3 0
2 years ago
The entry to record the use of direct materials in production would include a A. credit to Finished Goods Inventory. B. debit to
earnstyle [38]

Answer:  

B. debit to WIP inventory

Explanation:

The journal entry to record the usage of direct material in production is

Work in Process Inventory                                  Dr.

     To Raw Material Inventory

(Raw materials consumed recorded)

Raw material inventory is an asset. It's consumption should reduce it's balance. A debit increases an asset's balance while a credit reduces it's balance.

Work in process, like raw material is an inventory account i.e an asset. A debit increases their balance whereas a credit reduces it.

Here, raw materials i.e direct material have been issued for production, which would reduce their balance and increase the balance of work in process as finished goods are yet to be made.

3 0
3 years ago
Suppose the government launches a successful advertising campaign that convinces workers with high school degrees to quit their
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Suppose the government launches a successful advertising campaign that convinces workers with high school degrees to quit their jobs and become full time college students. This would cause the labor force participation rate to decrease.

Let's imagine that the government employs a convincing advertising campaign to persuade those with high school diplomas to quit their jobs and devote their full time to attending college. As a result, the rate of labor force participation would decrease.

The labor force participation rate provides an estimate of the size of the labor force in an economy. The percentage of the working-age, non-institutionalized population, aged 16 and over, that is employed or actively seeking employment is used in the calculation. When paired with the unemployment rates, it can help put the state of the economy in some sort of context.

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4 0
1 year ago
Bracken Clinic uses client-visits as its measure of activity. During September, the clinic budgeted for 2,100 client-visits, but
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The variance for net operating income in the revenue and spending variance column on the flexible budget performance report) for September would be closest to $910.

Explanation:

Following are the cost which are listed as follows,

  • Variable element per month client-visit Revenue = $44.50
  • Personnel expenses= $26,100 $12.60
  • Medical supplies= 6007.20
  • Occupancy expenses= 6,500
  • Administrative expenses= 3,100
  • Total expenses= $36,300 $22.30
  • Actual results achieved in the month of September is as under:
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3 years ago
Fidelity investments is one of the largest mutual fund and brokerage services providers worldwide. it has various offices in cit
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These visible cues are an attempt to deal with the problem of trust common to service organizations. Hence, the purpose of these cues is to generate much trust from the customers.

<h3>Common Customer Service Problems </h3>

The following are the common customer service problems encountered by the customers:

  1. Long time in response
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  4. Rudeness on the part of Customer Service agent towards the Clients
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Therefore, these cues are in place to earn trust from the customers.

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