The present worth of this business it has been calculated is given as $302,898.
How to solve for the worth of the business
<u>In the first year</u>
Cash flow = 44000
PVF at 9.7% = 0.91158
The present value = 0.91158 * 44000
= $40106
<u>In the second year </u>
Cash flow = $61,000,
PVF at 9.7% = 0.83097
The present value = $50689.17
<u>In the third year</u>
Cash flow = $80,000
PVF at 9.7% = 0.7575
The present value = $60600
<u>In the 4th year </u>
Cash flow = $200,000
PVF at 9.7% = 0.7575
The present value = $151,500
The worth of the business today is going to be the sum of all the present values
= $151,500 + $60600 + $40106.52 + $50689.17
= $302,898
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Answer:
17%
Explanation:
If a company issued a short-term note payable to a bank with a stated 12 percent rate of interest and in addition the bank charged a .5% loan origination fee and remitted the balance to the company. The effective interest rate paid by the company in this transaction would be 17%
The effective annual interest rate is <u>the interest rate that is actually earned or paid on an investment, loan</u> or other financial product.
Hence, since the company is both paying the initial 5% and the later 12%, effectively the company is paying 17% on the note payable.
Answer: c.
In a competitive market, there are many producers competing to provide consumers the products they needed and thus they cannot dictate prices.
If a surplus occurs, there is an excess of quantity supplied and since producers won't be able to sell all their products, they tend or are forced to lower their price.
The reverse happens when there is a shortage. When there is less supply in the market, price increases.
Surplus and shortage in a competitive market, therefore, will cause shifts in the demand and supply curves that tend to eliminate the surplus or shortage.
Natalie wants to make a 25% profit on a $70000 sale. That would be:
(125 ÷ 100) × 70000 = $87500.
Natalie wants to make $87500. But the agent would charge a 6% for the sale, Natalie will add a 6% to the $87500, that would be:
(106 ÷ 100) * 87500 = $92750.
On this $92750, there's a closing cost of $1200,
Add $92750 + $1200 = $93950.
$93950 to the nearest hundred will be $94000.
Natalie should make the final sale price $94000 in order to make a profit of %25.
Answer:
Lessee's Entries:
Rent expense (Dr.) $45,500
Cash (Cr.) $45,500
Lessor's Entries:
1. Property Tax expense (Dr.) $2,000
Maintenance and Repair Expense (Dr.) $650
Insurance Expense (Dr.) $500
Accounts Payable (Cr.) $3,150
2. Depreciation Expense (Dr.) $ 29,285
Accumulated Depreciation (Cr.) $29,285
3.Cash (Dr.) $45,500
Rent Revenue (Cr.) $45,500
Explanation:
The lease is considered as an operating lease as it does not have bargain purchase option and renewal options. The property ownership is not transferred in this lease.
Depreciation expense:
[ Cost - Salvage Value ] / 7
220,000 - 15000 / 7
