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SpyIntel [72]
2 years ago
15

Lotta Dough just won the state lottery and has elected to receive $50,000 per year for 20 years in the form of an annuity due. W

hat is the present value of this stream of payments if money can earn 7 percent annual interest?
Business
1 answer:
lidiya [134]2 years ago
3 0

Answer:

PV= $529,700.71

Explanation:

Giving the following information:

Cash flow= $50,000

the number of years= 20

Interest rate= 7%

First, we need to calculate the future value of the cash flows. We will use the following formula:

FV= {A*[(1+i)^n-1]}/i

A= annual pay

FV= {50,000*[(1.07^20)-1} / 0.07

FV= $2,049,774.62

Now, we can calculate the present value.

PV= FV/(1+i)^n

PV= 2,049,774.62/1.07^20

PV= $529,700.71

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The owner’s equity section of the balance sheet for the Blue Top Taxi Company shows that
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Answer:

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Explanation:

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3 years ago
Moorcroft Company’s budgeted sales and direct materials purchases are as follows:
Rama09 [41]

Answer:

a) Month        Sales

April           $300,000

May            $320,000

June           $370,000

Schedule of expected collections

For the month of June, 202x

Cash sales during June = $370,000 x 40% = $148,000

Collection from June's credit sales = $222,000 x 30% = $66,600

Collection from May's credit sales = $192,000 x 40% = $76,800

Collection from April's credit sales = $180,000 x 26% = $46,800

Total cash collections during June = $338,200

b) Month        DM purchases

April           $45,000

May            $54,000

June           $60,000

Schedule of expected cash payments for direct materials purchases

For the month of June, 202x

Cash purchases during June = $60,000 x 50% = $30,000

Cash payments for May's purchases = $27,000 x 40% = $10,800

Cash payments for April's purchases = $22,500 x 60% = $13,500

Total cash payments during June = $54,300

c) Month        Sales

April           $299,000

May            $337,000

June           $387,000

Schedule of expected collections

For the month of June, 202x

Cash sales during June = $370,000 x 40% = $148,000

Collection from June's credit sales = $222,000 x 30% = $66,600

Collection from May's credit sales = $192,000 x 50% = $96,000

Collection from April's credit sales = $180,000 x 18% = $32,400

Total cash collections during June = $343,000

It would be worth to pay the collector since the 2% reduction in uncollectible accounts is worth much more than the $1,000 that he/she earns.

d) Month        DM purchases

April           $45,000

May            $54,000

June           $60,000

Schedule of expected cash payments for direct materials purchases

For the month of June, 202x

Cash purchases during June = $60,000 x 40% = $24,000

Cash payments for May's purchases = $32,400 x 40% = $12,960

Cash payments for April's purchases = $27,000 x 60% = $16,200

Total cash payments during June = $53,160

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3 years ago
Burger Buddies restaurant chain is attempting to bring back their fried fish sandwich. It is an
worty [1.4K]

The marketing firm need to focus their efforts on

product modification.

<h3>What is product modification</h3>

Product Modification includes changes that are done on an existing product to make it more acceptable.

This could include branding, changing the quantity and colour to help increase the demand.

Therefore, The marketing firm need to focus their efforts on product modification.

Learn more on marketing here,

brainly.com/question/25369230

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FOUR types of visual aids are, but not limited to, physical samples, models, handouts, pictures, videos.

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C. as the supply for milk increases, the price of milk will also increase

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