Answer:
A) We need to save $1,005 per month in order to have 1,500,000 in 30 years.
B) We will be able to borrow 158,579
C) We will have 2,259,361 in 35 years
D) The equivalent amount of money is 12,585
Explanation:
A) We are given a future value that we need to have in 30 years. So our future value is 1,500,000. Our present value is 0, our interest rate is 8/12=0.667. We divide 8 by 12 because we need to save money per month. The number of compounding periods are (30*12)=360. We multiply by 12 because monthly payments. Now we will enter this information in a financial calculator to find future value.
Pv= 0
FV = 1,500,000
I=0.66
N=360
Compute PMT= 1,005
B) PMT= 900
I=5.5/12=0.458
N= 30*12=360
FV=0
Compute PV
PV=158,579
C) PV= 100,000
PMT= 300
N= 35*12= 420
I=8/12=0.66
Compute FV=2,259,361
D) We need to know how much money will we need 30 years from now if we want to buy goods and services which are worth 6,000 today considering an inflation rate of 2.5%
We will multiply 6000 by (1+Inflation)^number of years
6000*(1.025)^30
=12,585
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Answer:
James will lose money, since his earnings will be lower than the interest that he must pay.
Explanation:
The capitalization (cap) rate is a ratio calculated by dividing the net operating income over the property asset value.
For example, if James is purchasing the property at $100,000, his net earning will be $7,500 per year (cap rate of 7.5%), but he will have to $8,000 in interests for the property. The interests are higher than the earnings, therefore the leverage is negative.
Answer:
The answer is aging of accounts receivable method.
Explanation:
This method helps accountants in determining how much of a company’s account receivables would not be collected. This is related to unpaid invoices of a company’s customers. Though invoices usually have due dates, according to the company, customers who haven’t paid even after the due date has passed must be calculated using this method for more accurate accounting reporting.
Both operating expenses and cost of goods sold (COGS) are expenditures that companies incur with running their business. However, the expenses are segregated on the income statement. Operating expenses and COGS measure different ways in which resources are spent in the process of running a company.
