Personal letters cannot be included
First step to solving the given question is finding amount of depreciation to be charged each year. As per the generally accepted principles of accounting Straight line method of calculating depreciation is a widely used and accepted method. Thus, we shall use this method to calculate depreciation as below:
Depreciation= (Total Value of Asset- Salvage Value)/ No of years of useful life.
Depreciation=(40900000-4090000)/15
Depreciation= $2454000 per year
Thus at the end of year 1 book value of the asset will be as below:
Cost of the asset $40900000
Less: Depreciation ($2454000)
Book Value of the asset $38446000
Answer:
PV $54,509.5346
Explanation:
We will calcualte the present value of an annuity of 8,000 for 12 years at 10% discount rate:
The formula of annuity is:
C 8,000 dollars
time 12 years
rate 10% = 10/100 = 0.10
PV $54,509.5346
Answer:
C.Implied warranty
Explanation:
An implied warranty is an assumed assurance that the product purchased is fit to function as intended. The implied warranty can be oral, written, or silent.
An implied warranty protects customers from dishonest traders. All products and some services carry an implied warranty, written or not. The warranty guarantees that the product conforms to the buyer's expectations. For example, if you buy a car, you expect the engine to start and the vehicle to move.
Frank has an implied warranty. He's expectations are the blind will work. Products with an implied warranty may also come with other forms of assurances such as express or full warranties.
Answer:
b. 7.28%
Explanation:
This question is asking for the yield to maturity(YTM) of the bond. You can solve this using a financial calculator with the inputs below. Additionally, adjust the coupon payment(PMT) and time to maturity(N) to semiannual basis.
Time to maturity; N = 5*2 = 10
Face value; FV = 1000
Price of bond; PV = -1071
Semiannual coupon payment; PMT = (9%/2) *1000 = 45
then compute semiannual interest rate; CPT I/Y = 3.64%
Next, convert the semiannual rate to annual rate(YTM) = 3.64% *2
YTM = 7.28%
