Answer: $315.47
Explanation:
As this requires equal annual payments, it makes it an annuity. The $1,000 debt will be the present value of the annuity so a present value of annuity formula can be used:
1,000 = Annuity * ( 1 - ( 1 + rate) ^ -n) / rate
1,000 = Annuity * ( 1 - ( 1 + 10%)⁻⁴ ) / 10%
1,000 = Annuity * 3.169865
Annuity = 1,000/3.169865
Annuity = $315.47
Answer:
$3.90
Explanation:
using the discount model we can calculate the stock price:
stock price = [dividend x (1 - g)] / (RRR + g) ⇒ since the growth rate is negative, we need to change additions for subtractions and vice versa.
stock price = [$0.86 x (1 - 3.5%)] / (17.8% + 3.5%) = ($0.86 x 0.965) / 0.213 = $0.8299 / 0.213 = $3.90
Answer:
B) Children’s clothing only
Explanation:
cost of the expansion $148,000
three mutually exclusive projects:
- NPV $221,000 for children’s clothing ≥ $148,000 (initial investment)
- NPV $178,000 for exclusive gifts ≥ $148,000 initial investment
- NPV $145,000 for decorator items ≤ $148,000 initial investment
The projects whose NPV is positive should be considered (this eliminates decorator items)
Since the projects are mutually exclusive, only one can be chosen. So the project with the highest NPV is the best project for the store ⇒ children's clothing
Answer:
Sports Merchandise
Explanation:
According to the situation that has been described in the question it can be said that the loss is suffered by Sports Merchandise. This is because a the seller of a good or product is liable for that product until the buyer purchases the product and decides to keep it. Which in this scenario since Sports Merchandise made a mistake on the product size and Quest decided not to accept the product then the responsibility and risk of loss remained with Sports Merchandise as the owner of the product.
Answer:
The answer is: A) The new machinery can be depreciated using the same method or different method than the previously purchased machinery
Explanation:
Their is no rule that requires a business to always use the same depreciation method for the assets they purchase.
The most common depreciation methods include:
- Straight-line.
- Double declining balance.
- Units of production.
- Sum of years digits.
Depending on the asset a business may consider one depreciation method that better suits it, and another depreciation method for their other assets.
