I am figuring this question out for you! one moment please
Explanation:
Answer:
b) The cost of the building will include the cost of replacing the roof.
Explanation:
As for the information provided,
We know that the capital expenditure is capitalized and that the revenue expenditure is provided in income statement.
The capital expenditure is added in the cost of fixed assets and then depreciated as part of it.
The entire replacement of roof will be a huge part of consideration of building, and is capital in nature. Thus, it shall be part of cost of building.
Remaining all expenses are not capital in nature.
Good judgement is important in making decisions when budgeting because they can allow one to predict fairly accurately what the costs will be of a particular project based on one's own experience and of the current prices of supplies and say drilling charge rates and also with an adequate allowance for contingency.
Answer:
The annual worth of the overhead costs for 7 year-period is
A = $389743.42.
<em>Then the time value of the annual worth is discounted by 8%</em>
∴ $389743.42 x 0.08 = $31179.47.
Explanation:
Using the formula
A = P(1 + r/n)
Where:
A = ?
t = 7
P = $200,000.00
r = 10%
n= 1
TVM =8%
∴ A = $200,000.00(1 + 0.10/1)
A = $200,000.00(1.10)
A = $200,000.00(1.9487171)
A = $389743.42
<em>Then the time value of the annual worth is discounted by 8%</em>
∴ $389743.42 x 0.08 = $31179.47
So you could calculate the time it would take to get to work. And the cost to get there like transportation and gasoline.
