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2 years ago

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Perdue Company has purchased equipment that requires annual payments of $30,000 to be paid at the end of each of the next 6 year

s. The appropriate discount rate is 12%. What amount will be used to record the equipment?a. $165,772b. $180,000c. $115,650d. $123,342

1 answer:

Charra [1.4K]2 years ago

6 0

The answer will be $123,342

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Answer:

Bart Inc.

The initial value of the machine is:

= $114,240.

Explanation:

a) Data and Calculations:

Date of purchase of machine from Fell Corp. = December 31, 2016

Annual payments for a non-interest-bearing note = $20,000

Appropriate present value of the annuity due = 5.712

PV of the annual payments for 8 years = $114,240 ($20,000 * 5.712)

First payment date = December 31, 2016

Period of payments = 8 years

Prevailing interest rate for this type of note = 11%

Check from an online financial calculator:

N (# of periods) 8

I/Y (Interest per year) 11

PMT (Periodic Payment) 20000

FV (Future Value) 0

Results

PV = $114,243.93

Sum of all periodic payments = $160,000.00

Total Interest = $45,756.07

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2 years ago

1. Demand curves faced by individual firms in a competitive market are thought to be perfectly elastic while the demand curve fa

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Answer:

A). The demand curve looked by the flawlessly serious firms are splendidly versatile this is a result of the items selling in the ideal rivalry. The items are indistinguishable so no firm has power over the market cost, in the event that one firm builds the cost of the item the purchasers will quickly move to the result of different firms on the grounds that the items are indistinguishable. No firm has the motivator lessen the cost of their item. So the interest bend would be a level straight line corresponding to the X pivot, this demonstrates the interest is splendidly versatile. A cost increment will bring the amount requested to zero.

B). The monopolists is just the single vendor in the market, so he can charge any value he needs, yet the amount requested will be relied on the value he charges. For instance in the event that he charges a significant expense the amount demanded will be very less and the other way around. So the monopolist is capable sell more at lower costs just, the descending inclining request bend shows the negative connection between the cost and the amount requested.

C). In the ideal rivalry there is consummately flexible interest so the MR curve is likewise the interest curve of the firm. For the monopolist the MR curve lies underneath the interest curve, as the costs go bring down the MR decreases.

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2 years ago

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Answer:

True

Explanation:

A more precise way to describe the situation is that Joe's pizza parlor is a monopolistic competition. But that definition considers that all 'food' items have some degree of close substitute relation.

But yes, if you consider this two conditions:

a broad definition of monopoly
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Then yes, Joe has monopoly

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3 years ago

Margaret Williams, production manager at Williams Manufacturing, finds her profits at $15,000 inadequate for her business. The b

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Answer:

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Explanation:

The calculation of percentage in sales is shown below:-

Increase in profit required = $25,000 - $15,000

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= $55,555.55

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2 years ago

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Answer with Explanation:

Probability Expected Loss Loss Forecast

0.5 0 0

0.1 200 20

0.2 400 80

0.1 1000 100

0.1 2000 200

1.00 Total 400

Now,

A. Final Wealth with no Insurance = Physical Assets of the person + Cash Assets - Total Loss Forecast

By putting values, we have:

Final Wealth with no Insurance = $2,000 + $600 - $400 = $2,200

B. For Full insurance, we will not consider expected loss because we will receive Insurance Premium instead:

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By putting values, we have:

Final Wealth with Full Insurance = $2,000 + $600 - $600 = $2,000

C. Final Wealth with Partial Insurance and $200 deductibles = Physical Assets + Cash Assets - Insurance Premium For Partial Coverage - Deductible

By putting values, we have:

Final Wealth with Partial Insurance and $200 deductibles = $2,000 + $600 - $450 - $200 = $1,950

D. Final Wealth with 75% Co-insurance = Physical Assets + Cash Assets - Insurance Premium - Co-payment

By putting values, we have:

Final Wealth with 75% Co-Insurance = $2,000 + $600 - $450 - (75% * $400)

= $1,850

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By putting values, we have:

= $2,000 + $600 - $450 - (Probability 0.1 * $2,000) = $1950

From the above, we can say that the best option here in descending order is as under:

1. A. Final Wealth with no Insurance

2. B. With Full insurance

3. C. Final Wealth with Partial Insurance and $200 deductibles & E. Final Wealth with Partial Insurance and $1,000 Upper Limit

4. E. Final Wealth with Partial Insurance and $1,000 Upper Limit

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3 years ago