Answer:
Consider the following explanation.
Explanation:
1. True. It is generally seen in the automobile market. The purchased inventory serves as the collateral for the loan.
2. True. The higher capital provides support for the continued solvency of these comapanies.
3. False, The federal reserve has the right and authority to regulate finance companies.
4. This statement is true.
5. True. They also charge higher interest rates than banks for bearing the risk of poor credit of these borrowers.
Answer:
Explanation:
1. The formula to compute the profitability index is shown below:
Profitability index = Net present value ÷ investment required
For Proposal A, it would be
= $331,300 ÷ $790,000
= 0.42
For Proposal B, it would be
= $48,300 ÷ $120,000
= 0.40
For Proposal C, it would be
= $62,000 ÷ $120,000
= 0.52
For Proposal D, it would be
= $607,200 ÷ $1,820,000
= 0.33
2. The proposal rank preference is shown below:
Proposal Profitability index Rank
A 0.42 Second
B 0.40 Third
C 0.52 First
D 0.33 fourth
So, it would be C, A, B and D
Answer:
1,657,000 units
Explanation:
The FIFO method is concerned with the work done in the current production period.
<u>Equivalent Units of Production - Conversion Costs</u>
To finish Opening Work In Process ( 85,000 x 80%) 68,000
Started and Completed [(1,430,000 - 85,000) x 100%] 1,345,000
Ending Work In Process 305,000 x 80% 244,000
Total Equivalent Units of Production - Conversion Costs 1,657,000
therefore,
the equivalent units for the conversion cost calculation are: 1,657,000 units
Answer:
False.
Explanation:
The hedonic property value method determines the extent that environmental or ecosystem factors affect the price of a home. This implies that the method cannot be used to estimate lost, non-use value associated with oil pollution at remote, uninhabited locations, as stated in the question. Since the hedonic property value method is used to estimate the housing prices that reflect the value of local environmental attributes, it is not useful for uninhabited, remote locations and properties.
Answer:
Annual contributions to the retirement fund will be $6,347.31
Explanation:
First find the Present Value of the Annuity giving payments of $32,000 annually for 25 years at the rate of 10%.
Using a Financial Calculator enter the following data
PMT = $32,000
P/y = 1
N = 25
R = 10%
FV = 0
Thus, the Present Value, PV is $290,465.28
At the time of retirement (in 20 years time) the Value of the annuity fund is $290,465.28.
Next we need to find the Payments PMT to reach this amount in 20 years time at the interest rate of 8%
Using a Financial Calculator enter the following data
FV = $290,465.28
N = 20
R = 8 %
PV = $0
Thus, the Payments, PMT required will be $6,347.3080
Conclusion :
Annual contributions to the retirement fund will be $6,347.31