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3 years ago

If $1,000,000 of 8% bonds are issued at 102 3/4, the amount of cash received from the sale is ______________.

Business

1 answer:

Jobisdone [24]3 years ago

4 0

Answer:

The amount of cash received from the sale is $1,027,500

Explanation:

In this scenario we first have to know the number of bonds issued and then multiply it by the bond price which is given to us in the question.

The bonds have a total face value of 1,000,000 and one bond is issued at 102.75 which means that the face value of a single bond is 100.

Now in order to find the number of bonds issued we will divide the total face value by the face value of a single bond.

1,000,000/100=10,000.

10,000 bonds were issued at $ 102.75 now in order to calculate the total cash received we will multiply the number of bonds with the issue price.

10,000*102.75=1,027,500

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3 years ago

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torisob [31]

Your answer is.......C) Natalie, who has business experience with accounting, management, and marketing

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3 years ago

After deciding to acquire a new car, you realize you can either lease the car or purchase it with a three-year loan. The car you

muminat

Answer:

a. $15,369.28

b. $16,332.28

c. $19,347.60

Explanation:

a. What is the present value of purchasing the car?

PV of resale = SP ÷ (1 + r)^n ................................................. (1)

Where SP = Resales proceed = $20,500

r = discount rate = 6% annually = 0.06 annually = (0.06 ÷ 12) monthly = 0.005 monthly

n = number of periods = 3 years = 3 × 12 = 36 months

Substituting into equation (1), we have:

PV of resale = $20,500 ÷ (1 + 0.005)^36 = $17,130.7208354753

Net PV = Purchase price - PV of resale

= $32,500 - $17,130.7208354753

Net PV = $15,369.28

Therefore, the present value of purchasing the car $15,369.28.

b. What is the present value of leasing the car?

PV of future period payment can be calculated using the following formula:

PV of monthly payment = M × 1 - (1 + r)^-n ÷ r .......................................... (2)

Where,

M = monthly payment = $494

r = discount rate = 6% annually = 0.06 annually = (0.06 ÷ 12) monthly = 0.005 monthly

n = number of periods = 3 years = 3 × 12 = 36 months

Substituting into equation (2), we have:

PV of monthly payment = $494 × {[1 - (1 + 0.005)^-36] ÷ 0.005}

PV of monthly payment = $16,238.2820221969

PV of leasing the car = Today's payment + PV of monthly payment

= $94 + $16,238.2820221969

PV of leasing the car = $16,332.28

Therefore, PV of leasing the car is $16,332.28.

c. What break-even resale price in three years would make you indifferent between buying and leasing?

This will be calculated by equating the PV of leasing the car to the difference between the purchase price and the PV of resale as follows:

PV of leasing car = Purchase price - PV of resale

$16,332.28 = $32,500 - PV of resale

Solving for PV of resale, we have:

PV of resale = $16,167.72.

The future value (FV) of resale price in 3 years can be calculated as follows:

FV of resale = PV of resale × (1 + r)^n

FV of resale = $16,167.72 × (1 + 0.005)^36 = $19,347.60

Therefore, the break even resale price in 3 years is $19,347.60.

7 0

3 years ago

Next year, Celebrity wishes to increase the unit selling price to $110. Sales commissions will change to 2.5% of sales. Cost of

mariarad [96]

Answer:

Celebruity has a unit contribution margin of $35 ($100-$62-$3), currently.

Celebrity will have a unit contribution margin of $42.25 =($110-$62-$2.75) whit the changes.

This is an increase of $10.25 in the unit contribution margin.

Sales volume remains to be the same at 150 units ($15000 / $100), so the effect on contribution margin is $1537.50 = (150 X $10.25).

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3 0

3 years ago

You have decided that you want to be a millionaire when you retire in 45 years.

avanturin [10]

Answer:

for rate 11.2 percent ,principal = 8419.47

for rate 5.6 percent , principal = 86123.90

Explanation:

given data

amount wish A = 1,000,000

time t = 45 year

rate r1 = 11.2 % = 0.112

rate r2 = 5.6 % = 0.056

to find out

how much do you have to invest today

solution

we know here amount formula that is

amount = Principal × $( 1+ r)^{t}$ ..........................1

here r is rate and t is time so

for rate r1 principal amount is by equation 1 we get

amount = Principal × $( 1+ r)^{t}$

1,000,000 = Principal × $( 1+ 0.112)^{45}$

principal = 8419.47

and for rate r2 principal is from equation 1

amount = Principal × $( 1+ r)^{t}$

1,000,000 = Principal × $( 1+ 0.056)^{45}$

principal = 86123.90

8 0

3 years ago