All categories

2 years ago

You want to be a millionaire when you retire in 40 years.

Business

1 answer:

Sedaia [141]2 years ago

7 0

Answer:

a. FV = $1,000,000

rate = 9.7%

n = 40 periods

FVIFA = [(1 + 0.097)⁴⁰ - 1] / 0.097 = 407.9960231

annual savings = $1,000,000 / 407.9960231 = $2,451.00

b. FV = $1,000,000

rate = 9.7%

n = 30 periods

FVIFA = [(1 + 0.097)³⁰ - 1] / 0.097 = 155.4306295

annual savings = $1,000,000 / 155.4306295 = $6,433.74

FV = $1,000,000

rate = 9.7%

n = 20 periods

FVIFA = [(1 + 0.097)²⁰ - 1] / 0.097 = 55.35978429

annual savings = $1,000,000 / 55.35978429 = $18,063.65

You might be interested in

Giant Equipment Ltd. Is considering two projects to invest next year. Both projects have the same start-up costs. Project A will

klemol [59]

Answer: A.) Project A, because it has a higher present value than project B.

B.) Project B

Explanation:

Particulars --------- project A ----------- project B

Annual cash flow -- 42000 ------------ 48000

Interest rate --------- 12% ----------------- 12%

Number of years ---- 8 -------------------- 7

Calculating the present value of both projects using a financial calculator :

At 12% rate of return :

PV of project A = $233,677.77

PV of project B = $219,060.31

B.) At 14% rate of return:

PV of project A = $222,108.80

PV of project B = $234,656.04

7 0

2 years ago

Norton Corporation received cash from issuing 10-year $200,000 bonds at face value. Interest of $10,000 is paid annually to the

Jobisdone [24]

Answer:

Issuance of bonds is a cash inflow

Payment of interest is a cash outflow

Explanation:

The issue of the bond at $200,000 face value would be a cash inflow under the financing activities of the cash flow when issued since more cash was received from the bondholders.

However,the payment of bond interest of $10,000 yearly is a cash outflow under the financing activities section of the statement of cash flows,since Norton Corporation would be parting with the amount on yearly basis till the bonds are retired.

5 0

2 years ago

Four investment bankers need to cross a bridge at night to get to a meeting. They have only one flashlight and 17 minutes to get

RideAnS [48]

Answer:

Correct Answer:

The correct sequence of crossing include:

<em>First, the Analyst takes the flashlight and crosses the bridge with the Associate. This takes 2 minutes. </em>The Analyst then returns across the bridge with the flashlight taking 1 more minute (3 minutes passed so far). The Analyst gives the flashlight to the VP and the VP and MD cross together taking 10 minutes (13 minutes passed so far).

The VP gives the flashlight to the Associate, who recrosses the bridge taking 2 minutes (15 minutes passed so far). The Analyst and Associate now cross the bridge together taking 2 more minutes.<em> Now, all are across the bridge at the meeting in exactly 17 minutes.</em>

Explanation:

The above is the only logical way through which all of them could be able to cross the bridge while still arriving to the meeting at/on the exact time.

6 0

2 years ago

Suppose you have a dinner gift certificate for $20. You can use it to order meatloaf or pot roast. Meatloaf costs $12, and pot r

antiseptic1488 [7]

Suppose you have a dinner gift certificate for $20. You can use it to order meatloaf or pot roast. Meatloaf costs $12 and pot roast costs $14. Meatloaf and pot roast are both worth $15 to you. The dollar value of the opportunity cost of choosing meatloaf instead of pot roast is $15 EX.

<h3>What Is Opportunity Cost?</h3>

Opportunity costs represent the potential benefits that an individual, investor, or business misses out on when choosing one alternative over another. Because opportunity costs are unseen by definition, they can be easily overlooked. Understanding the potential missed opportunities when a business or individual chooses one investment over another allows for better decision making.

Opportunity cost is often overlooked by investors. In essence, it refers to the hidden cost associated with not taking an alternative course of action. If, for example, a company pursues a particular business strategy without first considering the merits of alternative strategies available to them, they might fail to appreciate their opportunity costs and the possibility that they could have done even better had they chosen another path.

Formula Of Opportunity Cost

Opportunity Cost=FO−CO

where:

FO=Return on best forgone option.

CO=Return on chosen option.

Learn more about Opportunity cost on:

brainly.com/question/12121515

#SPJ4

8 0

1 year ago

Total payroll of Walnut Co. was $1,900,000, of which $330,000 represented amounts paid in excess of $118,500 to certain employee

babymother [125]

Answer:

Dr Salaries and Wages Expense $1,900,000,

Cr Withholding Taxes Payable $461,000,

Cr FICA Taxes Payable 124,890

Cr Cash 1,314,110

Dr Payroll Tax Expense 158,535

Cr FICA Taxes Payable 150,135

Cr FUTA Taxes Payable 3,360

Cr SUTA Taxes Payable 5,040

Explanation:

Walnut Co

Dr Salaries and Wages Expense $1,900,000,

Cr Withholding Taxes Payable $461,000,

Cr FICA Taxes Payable 124,890

Cr Cash 1,314,110

(1,900,000 – $330,000) × 7.65%+ ($330,000 × 1.45%)

=1,570,000×0.0765+4,785

=120,105+4,785

Dr Payroll Tax Expense 158,535

Cr FICA Taxes Payable 150,135

($1900,000 × 7.65%) + ($330,000 × 1.45%)

(145,350+4,785)

Cr FUTA Taxes Payable 3,360

($1,900,000 – $1,480,000) × .8%

420,000×.8%

Cr SUTA Taxes Payable 5,040

($420,000 × 1.2%)

7 0

2 years ago