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klasskru [66]
3 years ago
6

The proceeds of a 10,000 death benefit are left on deposit with an insurance company for seven years at an annual effective inte

rest rate of 5 percent.The balance at the end of seven years is paid to the beneficiary in 120 equal monthly payments of X, with the first payment made immediately. During the payout period, interest is credited at an annual effective interest rate of 3 percent.Calculate X.
Business
1 answer:
11111nata11111 [884]3 years ago
5 0

Answer: $135

Explanation:

First find the future value of the proceeds.

= 10,000 * (1 + 5%)⁷

= $14,071

The monthly payments are equal so X is an annuity and as the payment is made immediately, this is an Annuity due.

Convert the interest rate into monthly figure:

= 3%/12

= 0.25%

Present value of annuity = Annuity * (( 1 - (1 + r)^-n ) / r) * (1 + r)

14,071 = Annuity * ((1 - (1 + 0.25%) ⁻¹²⁰) / 0.25%) * (1 + 0.25%)

14,071 = Annuity * 103.82

Annuity = 14,071 / 103.82

= $135.53

= $135

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George owns a pizzeria in Queens, and he buys his cheese and dough and sauce from SYSCO. This firm provides its customers with t
alexandr1967 [171]

Answer:

Trade credit

Explanation:

Trade credit occurs between traders where a trader allows another to purchase goods without paying for them immediately.

It is the cheapest form of short term financing.

This is a form of business to business agreement where payment is set at a later date of 30 days, 90 days or 60 days.

The transaction is recorded by using invoice.

Usually it is a zero percent short term finance. The amount of the good at time of purchase is what is paid at the sure date.

There is no extra payment made by the buyer as interest on the amount agreed.

5 0
2 years ago
What is the purpose of annotating mail?
NARA [144]
To annotate something is to look over. You need to re-check your mail before you send it off. Make sure the address is right. Make sure everything on there is correct before you send it off. The people that deliver the mail need to make sure they are giving the right person the right mail.<span />
3 0
3 years ago
Ruby is 25 and has a good job at a biotechnology company. She currently has $10,000 in an IRA, an important part of her retireme
kirill115 [55]

Answer:

a. How much will Ruby’s IRA be worth when she needs to start withdrawing money from it when she retires?

the future value of Ruby's IRA = $10,000 x 21.725 (FV factor, 8%, 40 periods) = $217,250

b. How much money will she have to accumulate in her company’s 401(k) plan over the next 40 years in order to reach her retirement income goal?

she needs to accumulate $875,000 - $217,250 = $657,750 during the next 40 years

the annual contribution = FV / FV annuity factor = $657,750 / 259.057 (FV annuity factor, 8%, 40 periods) = $2,539.02 per year

6 0
3 years ago
The Sun Company manufactures a special line of graphic tubing items. The company estimates it will sell 75,000 units of this ite
Mashutka [201]

Answer:

Instructions are listed below.

Explanation:

Giving the following information:

The company estimates it will sell 75,000 units of this item in 2008. The beginning finished goods inventory contains 20,000 units. The target for each year's ending inventory is 10,000 units.

1) <u>To calculate the budgeted units of production, we need to sum the sales of the period to the desired ending inventory and subtract the beginning inventory.</u>

Production budget= 75,000 + 10,000 - 20,000= 65,000 units

2)

Each unit requires five feet of plastic tubing. The tubing inventory currently includes 70,000 feet of the required tubing. Materials on hand are targeted to equal three month's production.

First, we need to calculate the ending inventory at years end:

ending inventory= (75,000/12)*3= 18,750 units

Purchases= production for the period + ending inventory - beginning inventory

Purchases= 65,000*5 + 18,750*5 - 70,000= 348,750 feet

7 0
3 years ago
Brief Exercise 12-8 have a carrying Ayayai Corporation purchased Johnson Company 3 years ago and at that time recorded goodwill
blsea [12.9K]

Answer:

Explanation:

Since the fair value of the division is less than the carrying value of the division so the loss on impairment is recorded

The journal entry to record the impairment of the goodwill is shown below:

Loss on impairment A/c Dr $30,000

                       To Goodwill A/c $30,000

(Being loss on impairment is recorded)

The computation is shown below:

= Carrying value - fair value  

= $300,000 - $270,000

= $30,000

4 0
3 years ago
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