Direct labor and overhead costs incurred to change raw materials into finished products are known as

If you invest $750 every six months at 8 percent compounded semi-annually, how much would you accumulate at the end of 10 years?

liq [111]

Answer:

FV= $22,333.56

Explanation:

Giving the following information:

Semi-annual investment= $750

Interest rate= 0.08/2= 0.04

Number of periods= 10*2= 20

<u>To calculate the future value, we need to use the following formula:</u>

FV= {A*[(1+i)^n-1]}/i

A= semi-annual deposit

FV= {750*[(1.04^20) - 1]} / 0.04

FV= $22,333.56

6 0

3 years ago

What method of decision making for a consumer

RSB [31]

Answer:

2 is the answer because of the method which has been discribed by the book

3 0

2 years ago

Swann Company sold a delivery truck on April 1, 2016. Swann had acquired the truck on January 1, 2012, for $45,500. At acquisiti

olganol [36]

Answer:

1.

Journal Entries

a.

Dr. Cash_________________$11,125

Dr. Accumulated Depreciation $36,125

Cr. Truck ________________ $45,500

Cr. Gain on Disposal ________$1,750

b.

Dr. Cash_________________$7,525

Dr. Loss on Disposal ________$1,850

Dr. Accumulated Depreciation $36,125

Cr. Truck ________________ $45,500

2.

a.

The gain is reported as a realized gain in the income statement after operating income for the period.

b.

The loss is reported as a realized loss in the income statement after operating income for the period.

Explanation:

1.

We need to calculate the depreciation for the 3 months of 2016.

Depreciation for the period = ( ( Initial cost -Residual Value ) / Useful life ) x Time Fraction = ( ( $45,500 -$3,000 ) / 5 ) x 3/12 = $2,125

Book Value on April 1, 2016 = Book Value on December 31, 2015 - Depreciation for 2016 = $11,500 - $2,125 = $9,375

Accumulated Depreciation = Initial cost - Book value = $45,500 - $9,375 = $36,125

Now compare The bok value o sale price to calculate the gain or losss

a.

Gain = Sale Value - Book value = $11,125 - $9,375 = $1,750

b.

Loss = Book Value - Sale value = $9,375 - $7,525 = $1,850

2.

4 0

3 years ago

Blenman Corporation, based in the United States, arranged a 2-year , $1,000,000 loan to fund a project in Mexico. The loan is de

SashulF [63]

Answer:

17.67%

Explanation:

Solution

Given that:

The Loan amount in USD = $1,000,000

The Loan is denominated in Mexican pesos.

The rate of exchange at the time of loan = 5.75 pesos per USD

Thus,

The Loan amount in Mexican pesos = 1000000 * 5.75 = 5,750,000 Mexican pesos

The Loan carries interest rate = 6.5%

Now,

The Loan duration = 2 years = 4 semiannual periods

The Loan to be repaid in Mexican pesos in 4 equal semiannual installments

So,

To get semiannual installments we will apply PMT function of excel:

Which is,

PMT (rate, nper, pv, fv, type) = PMT(6.5%/2, 4, -5750000, 0, 0)

= 1556164.09 Mexican pesos

Thus,

The exchange rate dropped to 5.10 pesos per USD before the first semiannual payment is due and stays so till the end of loan period.

Then,

The Semiannual installment in USD = 1556164.09 / 5.10 = $305,130.2137

To get nominal semiannual rate (for USD amounts) we will use RATE function of excel:

The RATE(nper, pmt, pv, fv, type)

= RATE (4, 305130.2137, -1000000, 0,0)

= 8.477%

Effective annual rate = (1 + 8.477%) 2 - 1 = 17.67%

Therefore, the effective annual interest rate will Blenman end up paying on the loan is 17.67%

7 0

3 years ago

$400,000 capital investment proposal has an estimated life of 4 years and no residual value. The estimated net cash flows are as

Brilliant_brown [7]

Answer:

Net present value = $13,110

Explanation:

The computation of the net present value is shown below:

Years Cash flows Present value factor Present value

0 -$400,000 1 -$400,000 (A)

1 $200,000 0.893 $178,600

2 $150,000 0.797 $119,550

3 $90,000 0.712 $64,080

4 $80,000 0.636 $50,880

Net present value $13,110 (B - A)

6 0

4 years ago