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deff fn [24]
3 years ago
13

You are hurt in a car accident and your lawyer wins a $100,000 settlement to be distributed as follows: $20,000 immediate paymen

t $5,000 a year for ten years $30,000 after ten years. Of the lawyer's fee is $10,000, what is the value of this settlement if the interest rate is 6 percent
Business
1 answer:
Orlov [11]3 years ago
5 0

Answer:

The value of the settlement is $ 62,604.06  

Explanation:

The value of the settlement is the present values of all cash flows less lawyer's fees of $10000

In discounting the cash flows, I used the Present Value formula,which is:

PV=FV/(1+r)^n

FV =future value,amount receivable at each point time

r=rate of return=6%

n is the applicable number of years to each future value amount, for instance the $30000 last payment is receivable in the eleventh year,hence n is 11 years

The settlement value is the figure in the excel spreadsheet attached.

Download xlsx
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Romona Company expects its November sales to be 20​% higher than its October sales of $ 240 comma 000. All sales are on credit a
kotykmax [81]

Answer:

The cash balance on November 30 amounts to $155,700

Explanation:

Cash balance on November 30 = Beginning balance + Collection of cash from October sales + Collection of cash from November sales - Payments for October Purchases - Payments for November Purchases

where

Beginning balance is $13,700

Collection of cash from October sales =  October Sales × % amount collected

                                                                = $240,000 × 70%

                                                                = $168,000

Collection of cash from November sales =  November Sales × % amount collected

                                                                = $240,000 × 1.20 × 25%

                                                                = $72,000

Payments for October Purchases = October Purchases × % amount paid

                                                        = $70,000 × 65%

                                                        = $45,500

Payments for November Purchases = November Purchases × % amount paid

                                                        = $150,000 × 35%

                                                        = $52,500

Putting the values in the above formula

Cash balance on November 30 = $13,700 + $168,000 + $72,000 - $45,500 - $52,500

= $155,700

4 0
3 years ago
When Patey Pontoons issued 6% bonds on January 1, 2018, with a face amount of $600,000, the market yield for bonds of similar ri
miskamm [114]

Answer:

Follows are the solution to this question:

Explanation:

Some of the missing data is defined in the attached file, please find it.

Bond problem rates  

Diagram values are based on the following:

N = 4\times 2 \\\\

    = 8 \ Years \\

i = 10.00 \% \times  \frac{1}{2} \\\\

  = 5.00 \% \\

\left\begin{array}{ccc} Cash \ Flow&\ \ \ \ \ \ \ Table \ Value  \times  Amount& \ \ \ \ \ \ \ \ =  Present \ Value\\ Principal  &0.676839 \times  \$ 600,000&    =\$ 406,104 \\ Semi-annual \ interest& 6.463213  \times \$ 18,000 &   =\$ 116,337\end{array}\right \\

Bond issuance price                                                                    

Timetable for bond amortization:  

please find the attachment.

5 0
3 years ago
Assume the price elasticity of demand (Ed) is 0.4 for gasoline in the long run. Some argue that we need a 50% reduction in gasol
dybincka [34]

Answer:

125%

Explanation:

Price elasticity of demand measures the responsiveness of quantity demanded to changes in price of the good.

Price elasticity of demand = percentage change in quantity demanded / percentage change in price

Let x = percentage change in price

o.4 = 50 / x

x = 125

7 0
3 years ago
On september 1, knack company signed a $50,000, 90-day, 5% note payable with central savings bank. what is the journal entry tha
shepuryov [24]
<span>The Journal entry upon the 90 days (1/4 using 360 days a year) maturity at 5% rate should be $50,000 plus the Interest (I). Let Journal Entry upon Maturity be J Where J = Initial Signed Note + Initial Signed Note * Rate * Time Which is also written as J = Initial signed Note (1 + Rate * Time) Therefore J = 50,000 (1+5/100*1/4) = 50,625</span>
5 0
3 years ago
Complete a​ fish-bone chart detailing reasons why an airline customer might be dissatisfied. LOADING... Click the icon to view t
kvv77 [185]

Answer:

<em>B: Machineries </em>

Lighting is not running,there seems to be an issue with the mechanical equipment and the chairs are too tight so there's no leg room.

<em>C: Methods </em>

The lack of adequate preparation and methods or processes results in delay of flight and also poor communication is the problem due to the lack of optimized or structured process.

<em>D: Man Power </em>

Scarcity is the reason why not enough ticket agents to issue tickets and manage the queue and also not enough traffic police to regulate and track the process.

5 0
3 years ago
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