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Vanyuwa [196]
3 years ago
12

Reeves Incorporated is issuing a note payable to four individuals for $5,000 each. Which individual will end up paying the MOST

in interest, assuming all individuals pay in full on the maturity date?
A : Individual 4 has an annual interest rate of 3.8% and a maturity date of six months.
B : Individual 1 has an annual interest rate of 3.5% and a maturity date of 60 days.
C : Individual 2 has an annual interest rate of 4.75% and a maturity date of three months.
D : Individual 3 has an annual interest rate of 4.05% and a maturity date of one year.
Business
1 answer:
cricket20 [7]3 years ago
8 0

Answer: The individual 3 will pay more interest amount, with an interest of $202.5. Therefore option D is the correct option.

Explanation: This is calculated using the simple interest formula.

I = P × R × T

I is the interest

P is the principal

R is the rate per year

T is the period of interest

Option A: for individual 4;

I = $5,000 × 0.038 × 6/12 = $95

Option B: for the individual 1;

I = $5,000 × 0.035 × 60/365 = $28.8

Option C: for the individual 2;

I = $5000 × 0.0475 × 3/12 = $59.4

Option D: for individual 3;

I = $5000 × 0.0405 × 1 = $202.5

Therefore, from the calculations above, the individual that will be most in interest is individual 3, because the individual interest amount is more. That means option D is most correct

While individual 1 will pay less is

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Answer:

Monthly payment: 460.41 dollars

Effective rate:  4.07%

Explanation:

we will calculate the PTM of an annuity of 25,000 over 5 year at 4%

PV \div \frac{1-(1+r)^{-time} }{rate} = C\\

PV  $25,000.00

time 60

rate 0.003333333

25000 \div \frac{1-(1+0.003333)^{-60} }{0.003333} = C\\

C  $ 460.413

Now we need to know the effective rate, which is the same as 4% compounding monthly:

(1+0.04/12)^{60} = (1+ r_e)^{5}\\r_e = \sqrt[5]{(1+0.04/12)^{60}} - 1

effective  rate = 0.040741543 = 4.07%

8 0
3 years ago
Which of the following statements is correct concerning product​ costs? A. Product costs are shown with current liabilities on t
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Answer: D. Product costs are expensed in the period the related product is sold

Explanation:

The statement that is true with regards to product cost is that product costs are expensed in the period the related product is sold.

It should be noted that the account for the cost of goods sold consist of product cost. In a situation whereby goods are not sold, the goods will be carried to the next period.

5 0
3 years ago
A company's ________ includes all the experiences the customer will have on the way to obtaining and using the offering.
Svetlanka [38]

Answer:

The value delivery system is the answer.

Explanation:

4 0
2 years ago
In the event of a "stockout" one of the things that could happen is __________________________________. a. the vendor's plant sh
-BARSIC- [3]

Answer:

d. extra shipping cost may be incurred.

Explanation:

Stockout means that a production company has no inventories to produce goods, which is a bad thing that can happen to a company. It means that production has stopped and customers cannot be supplied with order they have made.

There are several effects of stock out on a business, one of which is extra shipping cost may be incurred. A customer that is not ready to wait for his or her order to be met may have the item backorder expecially If the order was part of a larger delivery, then there would be backorder which will require special transportation.

Customers may also cancel his or her order and such customer is lost forever. This customer may also inform other customers thereby spreading bad news about the company which may reduce further sales of the company in the future.

When a company losses a customer as a result of stock out, or is no longer placing an order, a cost(cost of finding a customer a customer to replace the order which would have been purchased) is associated with that which will be borne by the vendor or the company.

7 0
2 years ago
weston mines has a cost of equity of 20.8 percent, a pretax cost of debt of 9.4 percent, and a wacc of 17.1 percent. ignore taxe
jonny [76]

If weston mines has a cost of equity of 20.8 percent, a pretax cost of debt of 9.4 percent, and a wacc of 17.1 percent. ignore taxes. the equity-asset ratio is:0.48.

<h3>How to find the equity -asset ratio?</h3>

Given data:

Cost of equity = 20.8%

Pretax cost of debt = 9.4%

Wacc =17.1%

Hence,

Equity -asset ratio:

0.208=0.171 + [(0.171 - 0.094) ×E/A]

0.208 -0.171 = [(0.171 - 0.094) ×E/A]

0.037=  0.077 ×E/A

E/A = 0.037/0.077

E/A =0.48

Therefore the equity- asset ratio is 0.48.

Learn more about equity-asset ratio here:brainly.com/question/28138260

#SPJ1

3 0
1 year ago
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