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Sunny_sXe [5.5K]
3 years ago
7

10. Calculate the future value of $2000 in a. 5 years at an interest rate of 5% per year. b. 10 years at an interest rate of 5%

per year. c. 5 years at an interest rate of 10% per year. d. Why is the amount of interest earned in part(a) less than half the amount of interest earned in part (b)
Business
1 answer:
timofeeve [1]3 years ago
4 0

Answer and Explanation:

The computation is shown below;

Given that,

Principal = P = $2000

As we know that

Future value (FV) = P × (1 + R)^n

here,

R = Rate of interest,

N = no of years

Now

A) N = 5, R = 5% = 0.05

FV = $2,000 × (1.05)^5

= $2,553

The Interest earned is

= $2,553 - $2,000

= $553

B) N = 10, R = 5% = 0.05

FV = $2,000 × (1.05)^10

= $3,258

The Interest earned is

= $3,258 - $2,000

= $1,258

C) N = 5, R = 10% = 0.10

FV = $2,000 × (1.10)^5

= $3,221

D) Option A

As in the part B the time period is 10 years as compared with the part A i.e. 5 years having the interest rate same

Also the cumulative interest would be greather than double as compared with part A

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Answer:

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<u>Journal entries to record the current month activity.</u>

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Credit : Applied Overheads ($21,000 x 160%)    $33,600

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2 years ago
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hammer [34]

Answer:

15.2%

Explanation:

Return on Total Asset is the ratio of net income ratio to total asset of the company. It measure the productivity and efficiency of all the assets used to generate this net income.

As per given Data

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Net sales                      $478,500     $426,250

Cost of goods sold      $276,300     $250,120

Interest expense          $9,700         $10,700

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Net income after tax    $46,050      $39,900

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