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3 years ago

7

You purchase an annuity due for $1,200. The annuity has 11 annual payments of 100 and a larger payment at the beginning of year

12. The effective annual interest rate is 3.50%. What is the present value at the end of the 8th year of the remaining payments?

1 answer:

romanna [79]3 years ago

8 0

Answer:

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Explanation:

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For each of the following, compute the present value: (Do not round intermediate calculations and round your answer to 2 decimal

timurjin [86]

Answer:

Present value = FV / (1 + r)^t

1. PV = $19,415 / (1 + 0.07)^15

PV = $19,415 / (1.07)^15

PV = $19,415 / 2.759031

PV = $7,036.89

2. PV = $47,382 / (1 + 0.11)^8

PV = $47,382 / (1.11)^8

PV = $47,382 / 2.3045378

PV = $20,560.31

3. PV = $312,176 / (1 + 0.10)^13

PV = $312,176 / (1.10)^13

PV = $312,176 / 3.4522712

PV = $90,426.27

4. PV = $629,381 / (1 + 0.13)^25

PV = $629,381 / (1.13)^25

PV = $629,381 / 21.230542

PV = $29,645.07

5 0

3 years ago

Herman Company has three products in its ending inventory. Specific per unit data at the end of the year for each of the product

jek_recluse [69]

Answer:

Product 1 - $36

Product 2 - $ 96

Product 3 - $66

Explanation:

The accounting standard for Inventory under IFRS IAS 2 requires that inventory be recognized at cost which includes all the cost incurred to bring the item of inventory to a state or place where the item of inventory becomes available for sale.

These costs includes cost of purchase, freight, Insurance cost during transit etc.

Subsequently, inventory is to be carried at the lower of cost or net realizable value.

The NRV is the Selling price less the cost to sell.

Given

Product 1 Product 2 Product 3

Cost $36 $ 106 $ 66

Selling price $ 88 $ 168 $ 118

Costs to sell $ 9 $ 72 $ 26

NRV $ 79 $ 96 $ 92

6 0

3 years ago

A summary of cash flows for Adventure Travel Service for the year ended April 30, 2019, follows:

zalisa [80]

Answer:

<u>Adventure Travel Service</u>

<u>Statement of cash flows for the year ended April 30, 2019</u>

<u>Cash flow from Operating Activities</u>

Cash receipts from customers $2,080,000

Cash payments for operating expenses ($1,706,000)

Net Cash from Operating Activities $374,000

<u>Cash flow from Investing Activities</u>

Purchase of land ($400,000)

Net Cash from Investing Activities ($400,000)

<u>Cash flow from Financing Activities</u>

Cash receipt from owner as investment $60,000

Drawings ($40,000)

Net Cash from Financing Activities $20,000

Movement in Cash and Cash Equivalents ($6,000)

Beginning Cash and Cash Equivalents $203,000

Ending Cash and Cash Equivalents $197,000

Explanation:

The Statement of Cash flows shows the results of cash from the following sources : Cashflow from Operating Activities, Cashflow from Investing Activities and Cashflow from Financing Activities.

4 0

3 years ago

Which one of these affects the length of the cash cycle but not the operating cycle? A) Inventory period B) Accounts payable per

kifflom [539]

Answer:

E) Both the accounts receivable and the accounts payable periods

Explanation:

The account receivable and the accounts payable affect the length of the cash cycle. This is because, the longer the cash cycle, the more likely a firm will need external financing.

4 0

3 years ago

“A business organization requires both long term and short term capital which can

Anna007 [38]

The example of ownership capital is : Shares

Shares determine that you have a part of percentage of the company (you will also get part of its income)

Example of Borrowed capital is : Leasing.
Leasing is a rental agreement in which you can borrow goods that you can use for your production process

hope this helps

5 0

3 years ago