1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Anna11 [10]
2 years ago
7

Answer each of the following independent questions. Required: Alex Meir recently won a lottery and has the option of receiving o

ne of the following three prizes: (1) $88,000 cash immediately, (2) $34,000 cash immediately and a six-period annuity of $9,300 beginning one year from today, or (3) a six-period annuity of $18,400 beginning one year from today. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) 1.1 Assuming an interest rate of 7%, determine the PV value for the above options.
1.2 Which option should Alex choose? Option (1) Option (2) Option (3)
2. The Weimer Corporation wants to accumulate a sum of money to repay certain debts due on December 31, 2022. Weimer will make annual deposits of $175,000 into a special bank account at the end of each of 10 years beginning December 31, 2013. Assuming that the bank account pays 8% interest compounded annually, what will be the fund balance after the last payment is made on December 31, 2022?
Table of calculation function?
Payment?
N?
I?
Future value?
Business
1 answer:
Lady_Fox [76]2 years ago
7 0

Answer:

option 1

$4,056,237.49

Explanation:

To determine the better option, we have to determine the present value of options 2 and 3

Present value is the sum of discounted cash flows

Present value can be calculated using a financial calculator

option 2

Cash flow in year 0 = $34,000

Cash flow in year 1  to 6 =  $9,300  

I = 7 %

PV =  78,328.82

Option 2

Cash flow in year 1  to 6 =  $$18,400

I = 7 %

PV = 87704.33

To find the NPV using a financial calculator:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. after inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.  

3. Press compute  

It is the first option that has the highest value

The formula for calculating future value = A / annuity factor

Annuity factor = {[(1+r) n] - 1} / r

P = Present value  

R = interest rate  

N = number of years  

You might be interested in
Hernandez Builders has a gross payroll for January amounting to $500,000. The following amounts have been withheld: Federal inco
sattari [20]

Answer:

Net pay is  $383,750

Explanation:

Hermandez builders net pay can be computed by deducting the following from the gross payroll amount:

Federal income taxes

social security

medicare

charitable contributions

union dues

The net pay is computed thus:

Gross payroll pay                                                      $500,000

Federal income taxes                              $63,000

Social security                                          $31,000

medicare                                                  $7,250

charitable contributions(1%*$500000)  $5,000

union dues (2%*$500000)                     $10,000    

                                                                                ($116,250)

Net pay                                                                     $383,750  

3 0
3 years ago
When a retail merchandising business sells goods to a customer the amount of the sold merchandise is credited to the merchandise
Ghella [55]

Answer: False

Explanation:

The revenue account for a Retail Merchandising Business is also known as the Sales Account.

When goods are sold they are credited to the Sales Account and it is no different here.

Therefore, When a Retail Merchandising Business sells goods to a customer the amount of the sold merchandise is credited to the Sales Account which makes the above statement false.

8 0
3 years ago
The current property taxes on a parcel are $1,743.25 and have not been paid. If the sale is to be closed on August 12, what is t
galben [10]

Answer:

$1,743.25 divide 360 =$4.84 taxes per day

prorate jan1-aug12=222days

222x4.84=$1,074

Explanation:

5 0
3 years ago
Predetermined Overhead Rate, Application of Overhead to Jobs, Job Cost
Ghella [55]

Answer:

See below

Explanation:

1. Predetermined overhead rates

= Applied overhead / Direct labor

Job 114

Applied overhead / direct labor

= $1,260/1,800

= 70%

Job 115

Applied overhead / direct labor

= $994/1,420

= 70%

Job 116

Applied overhead / direct labor

= $3,094/4,420

= 70%

2 and 3 Ending balance of each job and work in process as of April 30th.

Job 114. Job116

Opening. $2,384. $3,085

Materials

Purchases $16,800. $5,410

Direct labor

($1,800+$1,800) $3,600. $5,740

Actual $2,520 $4,018

Overhead

at 59.36%

Balance $25,304. $18,253

• Note

The whole of job 115 has been sold out.

• Actual overhead = Actual overhead / direct labor

= $4,535/7,640

= 59.36%

4 Cost of goods sold in April

Job 115

Opening materials. $2,603

Purchases. $12,460

Direct labor

($1,420 + $3,080). $4,500

Actual overhead. $3,150

at 59.36%

Cost of goods sold $22,713

5. Selling price of job

Cost of job 115 = $22,713

Selling price = 1.25% × $22,713 = $28,391

4 0
3 years ago
Which of the following statements is true? a. The production budget is not converted into dollars. b. The sales budget includes
Svetllana [295]

Answer:

e. All of these choices are correct.

Explanation:

Note:

Statement a. about production budget is correct as the production budget only estimates number of units to be produced, in quantity and not in dollars and therefore is not converted into dollars.

Statement b. about sales budget is also correct as it shows the quantity in units and also in value.

Statement c. about overhead budget is also correct as the budget segregates variable and fixed overheads properly.

Statement d. about labor budget is correct, as in this budget an average rate is used for calculating the expenses.

Therefore all of the above is correct.

8 0
3 years ago
Other questions:
  • If it takes a fan 20 minutes to walk to her seat in the last section in the stadium and it takes 5 minutes to get to the lowest-
    10·1 answer
  • The HR department at Tremont Communications oversees the recruitment and training of employees at the firm. As the firm grows an
    7·2 answers
  • Defining the communications objectives to be accomplished and then, estimating the costs associated with the performance of the
    13·1 answer
  • one theory behind ____ is that the best outcome to civil ______ is a _____ and that parties will move toward agreement if they u
    15·1 answer
  • Fixed financial charges include ________. stock repurchase expense common stock dividends and bond interest expense common stock
    11·1 answer
  • Clark had no stock transactions in 2018​, so the change in​ stockholders' equity for 2018 was due to net income and dividends. I
    12·1 answer
  • All of the following are good reasons why employers often consider hiring veterans from the armed services EXCEPT...
    8·1 answer
  • In a _____ organizational structure, personnel often report to both a functional manager and one or more project managers. matri
    8·1 answer
  • Kenneth purchased a car from his local dealership, Quartent Cars. However, since the car was not available in the color that Ken
    5·1 answer
  • Export assistance centers work with small and medium-sized businesses who wish to get involved in:_______
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!