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3 years ago

If the risk-free rate of interest (rf) is 6%, then you should be indifferent between receiving $250 today or:

Business

1 answer:

kodGreya [7K]3 years ago

8 0

Answer:

the indifference between receiving $250 today or is $235.85

Explanation:

The computation of the indifference between receiving $250 today or is shown below:

Here we determine the present value

= Amount ÷ (1 + risk free rate of interest)

= $250 ÷ (1 + 0.06)

= $250 ÷ 1.06

= $235.85

Hence, the indifference between receiving $250 today or is $235.85

The same is relevant and considered too

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A copy machine acquired with a cost of $1,410 has an estimated useful life of 4 years. It is also expected to have a useful oper

mafiozo [28]

Answer:

a. Straight-line method

Depreciation Expense for the first year: $333.75

b. Double-declining-balance method

Depreciation Expense for the first year: $667.5

c. Units-of-output method

Depreciation Expense for the first year: $450

Explanation:

a. Straight-line method

Depreciation Expense each year is calculated by following formula

Annual Depreciation Expense = (Cost of machine − Residual Value)/Useful Life = ($1,410 - $75)/4 = $333.75

Depreciation Expense for the first year: $333.75

b. Double-declining-balance method

Under the straight-line method, useful life is 4 years, so the asset's annual depreciation will be 25% of the Depreciable cost.

Depreciable cost = Total cost of machine - Residual value = $1,410-$75 = $1.335

Under the double-declining-balance method the 25% straight line rate is doubled to 50% - multiplied times

Depreciation Expense for the first year = $1.335 x 50% = $667.5

c. Units-of-output method

Depreciation Expense per copy = (Cost of machine − Residual Value)/Life in Number of Units = ($1,410 - $75)/13,350 = $0.1

Depreciation Expense for the first year = Depreciation Expense per copy x number of copies were made the first year = $0.1 x 4,500 = $450

3 0

3 years ago

2. Three years ago, Shawheen deposited $5,000 in a savings account. Today, the account is worth

AnnyKZ [126]

The amount of money Shawheen deposited in his savings account increased in value because of the interest rate his account earns.

The initial deposit might have a higher purchasing power because of inflation.

When money is deposited in a savings account, the amount of money earns interest.

The value of the interest rate can be determined using this formula: interest earned / (time x amount deposited)

Interest earned = $$5,306.04 - $5,000 = $306.04

Interest rate = $306.04 / (3 x $5000) = 2.04%

Inflation is the persistent rise in the general price levels. Inflation reduces the purchasing power of money.

To learn more about inflation, please check: brainly.com/question/18072639

4 0

2 years ago

5. What strategy does BCG prescribe for each SBU? 6. If you do not agree with the prescribed strategies. What would you do? Just

bixtya [17]

Answer:

Justify your recommendation. From the BCG Matrix we can tell that Electrical appliances unit is a Cash Cow with high market share and stable growth.

THEN U FIND ONE THAT U LIKE

HOPE THIS HELPS

Explanation:

8 0

3 years ago

Grecian Tile Manufacturing of Athens, Georgia, borrows $1,500,000 at LIBOR plus a lending margin of 1.25 percent per annum on a

shtirl [24]

Answer: 92812.50

Explanation:

The following information can be derived from the question:

Loan principal = $1,500,000

LIBOR for 1st 6 months = 4.50%

LIBOR for last 6 months = 5.375%

Lending margin per annum = 1.25%

The interest will then be:

= 1,500,000 × [(4.50% + 1.25%)/2] + 1,500,000 × [(5.375% + 1.25%)/2]

= 1,500,000 × [(0.045 + 0.0125)/2] + 1,500,000 × [(0.05375 + 0.0125)/2]

= 92,812.50

Therefore, the interest is 92812.50.

8 0

3 years ago

Department G had 2,040 units 25% completed at the beginning of the period, 12,200 units were completed during the period, 1,700

Margarita [4]

Answer:

18261

Explanation:

The first key-point will be that materials are applied entirely at the begining of the production so this part of the cost is quite easy:

You have an ending inventory of 1,700 units and then you have a given data of $9 per unit for direct materials so mulitply those to get:

ending inventory $15,300 materials cost

Next part will be to calculate the conversion cost.

First step, will be to calculate the conversion cost for the period,

which is direct labor + factory overhead:

78,600 + 26,200 = 104,800

Remember conversion cost = labor + overhead

Second, calculate the equivalent units:

Here we have the data for completed units so we work it like this

Complete units 12200

(this are finished o they count entirely)

+ ending units x percent of completion 1700 x 20% = 340

(this are units we work during this period)

- beginning units x percent of completion (2040) x 5% = (510)

(this are units we don't work on this period,

they are from the previous month,

so we subtract them)

----------------------------------------------------------------

Equivalent units for conversion cost 12030

Third, we are almost there, we will divide this two to get the value of 1 unit of conversion cost

104,800 conversion cost / 12,030 equivalent units = 8.7115 CC per unit

Fourth, calculate the conversion cost for the ending inventory

conversion cost per unit x equivalent units of ending inventory

8.7115 x 340 = 2961

Last Step, we add the materials cost with the conversion cost

15,300 + 2,961 = 18261 VALUE OF ENDING INVENTORY

3 0

4 years ago