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On January 1, Boston Company completed the following transactions (use a 7% annual interest rate for all transactions): (FV of $

GaryK [48]

Answer:

a) A sum of $6,000 is to be paid at the end of each year for 7 years and the principal amount $115,000 to be paid at the end of 7th year.

PV=$6,000/(1+0.07)^1 + $6,000/(1+0.07)^2 +$6,000/(1+0.07)^3 +$6,000/(1+0.07)^4 +$6,000/(1+0.07)^5 +$6,000/(1+0.07)^6 +$6,000/(1+0.07)^7 +$115,000/(1+0.07)^7

PV=$5,607.47 + $5,240.63 + $4,897.78 + $4,577.37 + $4,277.91 + $3,998.05 + $3,736.49 + $71,616.22

PV=$103,951.92

b) Let the single sum that will grow to $490,000 at 7% interest per annum at the end of 8 years be X

FV=PV(1+i)^n

$490,000 = X(1+0.07)^8

Thus,

X= $490,000/(1.07)^8

X = $490,000/1.7182

X = $285,182

Thhus, a single sum of $285,182 needs to be deposited for 8 years at 7% interest p.a.

The total amount of interest revenue is ($490,000-$285,182) = $204,818

c) PV = $75,000/(1.07)^1 + $112,500/(1.07)^2 + 150,000/(1.07)^3

PV = $70,093.45 + $98,261.85 + $122,444.68

= $290,800

FV =$75,000*(1.07)^1 + $112,500*(1.07)^2 + 150,000*(1.07)^3

= $80,250 + $85,867 + $91,878

= $257,995

d) The cost of the machine is $170,000. Immediate cash paid $34,000. Loan Amount is ($170,000-$34,000)=$136,000

The PVA factor at 7% p.a compounded annually for 5 years is 4.1002

Thus, the PMT = 136,000/4.1002

= $33,169

Thus, the amount of each annual payment is $33,169 for 5 years.

The total amount to be paid is ($34,000+$33,169*5)

=$34,000+$165845

=$199845

The interest expense is ($199845 - $170,000)

= $29,845

3 0

3 years ago

Read 2 more answers

7. A personal filing system should

ivann1987 [24]

Answer:

<h2><u>I would say the third option:</u></h2><h2><u>be simple and developed to meet your needs</u> </h2>

Explanation:

<em>Hope this helps :) </em>

<em>Pls make brainliest :3 </em>

<em>And have an amazing day <3</em>

8 0

3 years ago

Jeffery Brooks has just landed a job as the produce manager for a large grocery store. The store manager mentioned that last sum

tiny-mole [99]

Answer:

The correct answer is: a 10% increase in the price of cantaloupes will increase the quantity demanded of water melons by 11%.

Explanation:

The produce manager of a large grocery store is informed that the cross-price elasticity of demand between cantaloupes and water melons is 1.10.

The cross-price elasticity of demand is a measure to calculate the change in demand for a commodity due to a change in the price of another commodity.

It is calculated as a ratio of the percentage change in demand and percentage change in price.

A positive price elasticity implies that the two goods are substitutes. An increase in the price of one good leads to an increase in the demand for another.

The cross elasticity can be calculated as,

= $\frac{\% \Delta Qy}{\% \Delta Px}$

Let's assume that the price of cantaloupes increases by 10%.

Then,

1.10 = $\frac{\% \Delta Qy}{10 \%}$

ΔQy = 11

So we see that a 10% increase in the price of cantaloupes will cause the demand for water melons to increase by 11%.

7 0

3 years ago

You are trying to decide whether to take a vacation. Most of the costs of the vacation (airfare, hotel, and forgone wages) are m

nasty-shy [4]

Answer:

The correct answer is to put the two variables in the same type of measure.

Explanation:

To begin with, in order to compare to different variables that are in different measures the correct way to proceed is to put them in the same measure so therefore they will be comparable with each other. Once said that, in this case the person should put the psychological benefits in economics benefits as it is the other variable and in order to do that the person should think of what aspects of his productivity would increase if he takes the vacations and gains the psychological benefits. For example, after getting back from the holidays he may feel himself less stress and more relax and therefore that he may be able to either do more job, more studies or more excercises and all that can impact in an economic way.

7 0

3 years ago

Pat gave 5,000 shares of stock in Coyote Corporation (a publicly traded corporation) to her church (a qualified charitable organ

frutty [35]

Answer: a. $180,000

Explanation: Given that the fair market value of the 5000 shares of stock was $180,000 at that time; Pat should include this in information with proof of it's fair value at the time in schedule A of the form

8 0

4 years ago