1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Keith_Richards [23]
3 years ago
9

You are scheduled to receive annual payments of $3,600 for each of the next 12 years. The discount rate is 8 percent. What is th

edifference in the present value if you receive these payments at the beginning of each year rather than at the end of each year?A.$2,170.39B.$2,511.07C.$2,021.18D.$2,027.94E.$2,304.96
Business
1 answer:
KonstantinChe [14]3 years ago
7 0

Answer:

A. $2,170.39

Explanation:

First, we understand that what we are dealing with is Ordinary annuity which represents payments received at the end of each year

As such, The Present value of Ordinary annuity is calculated using the following formula

= Annuity amount x (1-(1+r)∧-n ) /r

Plugging this formula into the schedule given in the question ew have teh following

First, the present value of the payments received at the end of each year

= $3,600 x (1- (1.08∧-12) / 0.10

= $27,129.88

Secondly, the present valueof the payments received at the beginning of each year

= = $3,600 x (1- (1.08∧-11) / 0.10

= $25,700.27 + $3,600 (the amont recieved today)

Total PV = $29,300.27

Finally, find the difference between the PV of cash flow received at the beginning and PV of Cash flow received at the end=

= $29,300.27-  $27,129.88

= $2,170.39

You might be interested in
What is ethical behavior?
iren [92.7K]

Answer:

Ethical behavior includes honesty, integrity, fairness and a variety of other positive traits. Those who have others' interests in mind when they make decisions are displaying ethical behavior. In the workplace, there might be a standard for ethics set throughout the company.

Explanation:

3 0
3 years ago
What is the major difference between the unadjusted trial balance and the adjusted trial balance?
Dahasolnce [82]

A. the adjusted trial balance includes the postings of the adjustments for the period in the balance of the accounts.

The adjusted trial balance includes things like accrued revenues that weren't yet recorded, depreciation, unearned revenues and more.

8 0
2 years ago
If you start investing a little money now you will most likely have a lot more mone than those who start investing later on in l
Afina-wow [57]

True, usually the earlier you invest the more money you will get later down the road.  

7 0
3 years ago
Read 2 more answers
Sheridan Company includes one coupon in each bag of dog food it sells. In return for eight coupons, customers receive a leash. T
Gnesinka [82]

Answer:

Note: <em>The options attached belongs to another question, so the answer is not included</em>

Premium liability at December 31, 2020 = ((510,000*60%) - $130,000) /  8*3

Premium liability at December 31, 2020 = 176,000 / 24

Premium liability at December 31, 2020 = 7,333.33

Premium liability at December 31, 2021 = 7333.33 + ((600000*60%) - 150000) / 8*3

Premium liability at December 31, 2021 = 7333.33 + 360,000 - 150,000

Premium liability at December 31, 2021 = 217,333.33

4 0
2 years ago
Lewelling Company issued 101,000 shares of its $1 par common stock to the Michael Morgan law firm as compensation for 4,100 hour
GenaCL600 [577]

Answer:

Paid in capital excess of par is $$309,000

Explanation:

<u>Journal Entries</u>

Debt: Legal services (4,100 hours × $100 per hour)  = $410,000

Credit: Common stock (101,000 shares × $1 par)  = $101,000

Credit: Paid-in capital - excess of par (Remainder)  = $309,000

To record the 101,000 shares compensated by 4,100 legal hours with $1 par value)

In the above transaction common stock issued in excess of par for legal services as compensation instead cash. Hence "legal services" have been debited as issuing company benefited for legal services. "Common stock" and "paid in capital in excess of par" has been credited as this issuing company issuing common stock.

Paid in capital excess of par is $$309,000

3 0
3 years ago
Other questions:
  • Creative Sound Systems sold investments, land, and its own common stock for $38 million, $15.8 million, and $41.6 million, respe
    8·1 answer
  • In the _____ era, many companies adopted the philosophy that consumer satisfaction should be the central focus of the entire org
    13·1 answer
  • The advent of ________ has put buyers and sellers on much more equal footing.
    12·1 answer
  • When preparing the cash budget, all the following should be considered except: Group of answer choices Cash receipts from custom
    7·1 answer
  • McRae Corporation's total current assets are $396,000, its noncurrent assets are $512,000, its total current liabilities are $34
    13·1 answer
  • 1. Problems and Applications Q1 Suppose the demand for classical music concert tickets is downward sloping and the supply of cla
    13·1 answer
  • What do pre-teen ducks hate? <br> will mark brainiest for right answer!<br> think hard.
    8·1 answer
  • A company acquires a natural resource for and spends another on development of the site and for a nonmovable tangible asset inst
    14·1 answer
  • A manufacturing company applies factory overhead based on direct labor hours. At the beginning of the year, it estimated that fa
    13·1 answer
  • The short run is a period for which: Group of answer choices firms maximize total revenue instead of profit. diminishing returns
    6·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!