Answer:
$900,000
Explanation:
Given that,
Perpetuity payment = $100,000
Annual interest rate = 12.5 percent
Total value of investment should be:
= Perpetuity payment ÷ Annual interest rate
= $100,000 ÷ 0.125
= $800,000 (should be as balance on the date of retirement)
The first payment of $100,000 should be on the date of retirement
Therefore,
Total investment on the date of retirement should be:
= $800,000 + $100,000
= $900,000
Answer:
the internal rate of return is 12%
Explanation:
The computation of the internal rate of return is shown below:
Year Particulars Amount
0 Initial cost -$4,803.6 (C2)
1 Year 1 cash inflows $2,000 (C3)
2 Year 2 cash inflows $2,000 (C4)
3 Year 3 cash inflows $2,000 (C5)
IRR 12.00%
Use this below formula
=IRR(C2:C5)
Hence, the internal rate of return is 12%
A shortage in the marketing occurs if the quantity demanded is larger than the quantity supplied. If a shortage exists in a market, the natural tendency is for the price to increase. Gas is a great example if price increases when there is a shortage within the market. Whenever there is a shortage in gas we often see the price of gas driving upwards of cents to dollars more per gallon. This happens because the market is aware that even with the increase in price, people still need purchase gas to live daily life. Therefore, as it's rising in price, people are still purchasing and likely it will keep climbing for a little while.
Question
Monty Manufacturing builds playground equipment that it sells to elementary schools and municipalities. Monty's management has contracted you to perform a variance analysis on the fixed manufacturing overhead for its line of slides. Monty's cost accounting team informs you that it allocates fixed overhead based on machine hours. This period production was budgeted at 35
0 slides
. Budgeted and actual production data follows:
Standard fixed overhead cost per machine hour $5.00
Standard machine hours per slide 9
Actual production 390
Actual fixed overhead cost $20,000
What is the fixed manufacturing overhead volume variance in this period?
Answer:
Fixed overhead volume variance $1800 Favorable
Explanation:
Standard fixed cost per unit = cost per hour × standard hours
= $5.00 ×9 = $45
Units
Budgeted production unit 350
Actual production unit <u>390</u>
Volume variance in (units) 40
Standard fixed over cost per unit <u>× $45</u>
Fixed overhead volume variance <u> 1800 </u>Favorable
Fixed overhead volume variance $1800 Favorable
