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butalik [34]
3 years ago
9

Over the first four years of a company's life, it earned the following net income (loss): $10,000; $5,000; $6,000, and ($4,000).

If the company's ending retained earnings is $14,200 after year 4, what is the average amount of dividends paid per year?
Business
1 answer:
aleksandrvk [35]3 years ago
7 0

Answer:

$700

Explanation:

Total earnings in 4 years

= 10000 + 5000 + 6000 - 4000

= $17,000

Ending retained earnings after 4 years

= $14,200

Total amount paid out as dividend in 4 years

= 17000 - 14200

= $2,800

Average amount of dividends paid per year

= $2,800/4

= $700

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Shtirlitz [24]

Answer:

PV = $27,263.15

It will be needed to deposit the lump sum of $27,263.15

Explanation:

The question is asking for how much will you need to deposit in a lump sum  today to withdraw for seven years the sum of $5,600 with an interest rate of 10%

In other words it is asking us for the preset value of an annuity of $5,600 with interest of 10%

Using the present value of an annuity formula of $1 we can solve for the present value of that annuity, which is the amount needed to generate this annuity

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

We post our knows value and solve it:

5,600 * \frac{1-(1+0.10)^{-7} }{0.10}= PV\\

PV = $27,263.15

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False.

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Dividend Payable is then debitted and Cash will be credited to show money has gone out.

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