Answer:
So the depreciation in year 1 is $95,000
Explanation:
Depreciation is the accounting method that is used to allocate cost of an asset over its useful life. It is assumed that an asset losses values over a period and the salvage or terminal value is the value of the good after its useful life has ended.
Straight line method of depreciation assumes equal allocation of depreciation expense over the useful life of an asset.
In the given the asset value is $570,000 and the terminal value is $0
Using the formula
Depreciation= (Value of asset- Salvage value)/Number of useful years
Depreciation= (570,000-0)/6
Depreciation= $95,000 paid equally for 6 years
So the depreciation in year 1 is $95,000
Answer:
$12,100
Explanation:
Data provided;
Accumulated Depreciation = $3,200
Fees Earned = $17,400
Depreciation expense = $1,300
Insurance Expense = $200
Prepaid Insurance = $4,800
Supplies = $900
Supplies Expense = $3,800
Now,
The Net income
= Fees Earned - Depreciation Expense - Insurance Expense - Supplies Expense
= $17,400 - $1,300 - $200 - $3,800
= $12,100
Answer:
$729
Explanation:
We can calculate the actual cost value by first multiplying the purchase value by the depreciation rate and after that deducting that amount from the replacement cost.
DATA
Replacement value = $1,200
Purchase value = $942
Depreciation rate = 3 years/6 years = 0.5
Solution
Acutal cost value = Replacement value - ( Purchase value x Depreciation rate)
Acutal cost value = $1200 - ($942 x 0.5)
Acutal cost value = $729
Answer:
1. PV = 101.87
2. YTM = 7.46%
3. Price of the bond is $100.92
Explanation:
PV = 8.5/ (1.065) + 108.5/ (1.075)2
PV = 7.981 + 93.889
PV = 101.87
Part B:
PV = 101.870
FV = 100
N = 2
PMT = 8.5
Using Financial Calculator:
r = 7.459237
YTM = 7.46%
Part C:
The forward rate for next year, derived from the zero-coupon yield curve, is approximately:
(1 + forward Rate) = (1 + 0.075)2/ (1.065)
forward rate = 8.51%
Price of the bond = 108.5/ (1.0851)
Price of the bond = 100
Part D:
Interest Rate = 8.51% - 1% = 7.51%
Price of the bond = 108.5/ (1.0751)
Price of the bond = 100.92
Answer:
b. Free gift with purchase
Explanation:
The promotion tactic that the provider is trying to use is a Free gift with purchase. This is because by making your first every purchase the company is basically gifting you a certain amount of money through a discount of your purchasing total. Companies tend to do this in order to attract customers through the enticement of free money or products/gifts. They are able to do this because a single purchase will make them more profit than they are wasting on the gift and can lead to recurring customers.
