Your answer should be C. 50%. Because in 2011 there were 52% or violent crimes that were not reported to the police by the victims.
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Answer:
a-The net present value in dollars is 494939.0687.
b-1-The required return on franc flows is 11.72%.
b-2-The net present value in Francs is 519686.02.
b-3-The NPV in dollars as calculated from NPV in Francs is $494939.07
Explanation:
a
In order to find the solution, firstly the exchange rate for the 5 years is calculated. It is calculated using the formula:
Here
- EER is the expected exchange rate which is to be calculated
- CER is the current exchange rate which is 1.05
- GRD is the going rate of dollars which is 6% or 0.06
- GRF is the going rate of Francs which is 4% or 0.04
- t is the time in years.
From this exchange rate, the PV factor is calculated which is than used to find the present value and similarly net present value in total. The solution is provided in the attached Excel Sheet.
The net present value in dollars is 494939.07
b-1
The required rate on the Franc return is given as:
Here
- FRR is the franc return rate which is to be calculated
- DR is the dollar rate which is 14% or 0.14
- GRD is the going rate of dollar which is 6% or 0.06
- GRF is the going rate of Franc which is 4% or 0.04
So the value becomes:
The required return on franc flows is 11.72%.
b-2
Similar to part a, the solution is found for the return rate of 11.72 and the exchange rate is not required. The values are as indicated in the excel sheet attached.
The net present value in Francs is 519686.02.
b-3
In order to convert the Franc NPV to dollars, the exchange rate of 1.05SF is used which gives
Here
- NPV_dollars is the value of NPV which is to be calculated.
- NPV_francs is the value of NPV calculated in previous step which is 510686.02.
- ER is the exchange rate whose value is 1.05
So the equation becomes:
The NPV in dollars as calculated from NPV in Francs is $494939.07
Answer:
A.
(i) 70,000
(ii) 61,000
(iii) 2200
(iv) 7700
Explanation:
To calculate the sales revenue we will add cash collected from customers and we will deduct the opening balance in the closing balance. To calculate the cost of goods sold we will add a decrease in inventory and an increase in account payable in the cash payment for purchases.
Requirement A:
SALES REVENUE
Closing Balance 2700
Add:
Cash collected from customer 77,000
Less:
Opening balance (9700)
Sales revenue 70,000
COST OF GOODS SOLD:
Cash payment for purchase 57000
Add:
Decrease in inventory (6700-5700) 1000
Add:
Increase in account payable (14700-11700) 3000
Cost of goods sold 61,000
INSURANCE EXPENSES :
Insurance expenses = 4700 + 4700 - 7200
Insurance expenses = 2200
SALARIES AND WAGES EXPENSES :
Salaries and wages expenses = 2700+9700-4700
Salaries and wages expenses = 7700
Requirement B: JOURNAL ENTRIES
To record sales revenue
DEBIT CREDIT
Income summary 70,000
Sales revenue 70,000
To record the cost of sales
DEBIT CREDIT
Cost of goods sold 61,000
Insurance expenses 2200
Salaries and wages expense 7700
Income summary 70,900
A bond is a certificate of indebtedness.
Explanation:
A bond is a fixed income asset reflecting a loan to a borrower made by an investor. A relationship between the lender and the borrower which includes the details of the loan and its payments could be considered as an I.O.U.
A certificate of indebtedness is a negotiable instrument for the short term as evidence of a floating debt. A certificate of indebtedness was more of a government I.O.U., promising holders of certificates with a set coupon to return their funds.
CDs, bond certificates, promissory notes, etc. are all modern forms of certificates of indebtedness.