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coldgirl [10]
2 years ago
8

PRESENT VALUE OF AN ANNUITY Find the present values of these ordinary annuities. Discounting occurs once a year. 1. $600 per yea

r for 12 years at 8% 2. $300 per year for 6 years at 4% 3. $500 per year for 6 years at 0% 4. Rework parts a, b, and c assuming they are annuities due.
Business
1 answer:
NikAS [45]2 years ago
4 0

Answer:

    ordinary   // annnuity-due

1.- 4,521.65   //  4,883.38

2.- 1,572.64  //  1,635.54

4.- 3,000.00 //  3,000

Explanation:

C \times \frac{1-(1+r)^{-time} }{rate} = PV\\

C 600.00

time 12

rate 0.08

600 \times \frac{1-(1+0.08)^{-12} }{0.08} = PV\\

PV $4,521.6468

Annuity-due

600 \times \frac{1-(1+0.08)^{-12} }{0.08}(1+0.08) = PV\\

PV $4,883.3786

C \times \frac{1-(1+r)^{-time} }{rate} = PV\\

C 300.00

time 6

rate 0.04

300 \times \frac{1-(1+0.04)^{-6} }{0.04} = PV\\

PV $1,572.6411

Annuity-due

1,572.6411 x 1.04 = $1,635.5467

4.- as interest rate is 0% the money do not lose value over time

will be 3,000 regardless of time or type of annuity

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1 points eBookPrintReferencesItem 7Item 7 1 points Your grandparents would like to establish a trust fund that will pay you and
antiseptic1488 [7]

Answer:

$ 5,142,857.14

Explanation:

Calculation for how much must your grandparents deposit today

Using this formula

Amount that grandparents must deposit today = Regular amount / Rate of interest

Let plug in the formula Amount that grandparents must deposit today= 180,000 / 0.035

=$ 5,142,857.14

Therefore the Amount that grandparents must deposit today will be $5,142,857.14

8 0
2 years ago
When a company has an obligation or right to repurchase an asset for an amount greater than or equal to its selling price, the t
Alexus [3.1K]

Answer:

financing transaction.

Explanation:

A financial statement is a written report that quantitatively describes a firm's financial health. Under the financial statements is a cash-flow statement, which is used to record the cash inflow and cash equivalents leaving a business firm.

Cash flow statement, also known as the statement of cash flows, contains financial information about operating, investing and financing activities.

A transaction can be defined as a business process which typically involves the interchange of goods, financial assets, services and money between a seller and a buyer.

Financing transaction can be defined as an obligation or right of an organization (business firm) to repurchase an asset for an amount greater than or equal to the selling price of the asset.

7 0
1 year ago
The Hawkins Supply company is currently faced with an inventory rotation problem. This difficulty stems from the fact that some
Serga [27]

Here's the completed question.

Question: The company would like to reduce the double and sometimes triple handling of items. How can this goal be achieved? Are there alternative solutions which might also be effective?

Answer:

1. Using the Just in Time Management inventory technique.

2. Using automated inventory processing systems, changing physical layout of warehouse.

Explanation:

1. The Just in time method would allow Hawkins Supply company to quickly process its inventory by adopting a principle of processing smaller batches with reduced factory space. Doing so would minimise the worries about expired inventory since the inventory isn't excessive.

2. There are automated softwares such as the KANBAN system that would automated the process, requiring lesser use receipts to track inventories. Another alternative is to restructure the warehouse by making provision for racks that could be numbered serially to easily find desired inventory.

7 0
1 year ago
Taunton's is an all-equity firm that has 152,500 shares of stock outstanding. The CFO is considering borrowing $251,000 at 7 per
Ann [662]

Solution:

Price per share  

= Total Borrowing /No of shares repurchase

= 251,000 /21,500 = $ 11.67

Total Equity   = (Shares outstanding-Shares repurchased) * Price per share          

                     = (152,500 -21,500 )*11.67

                     = $1,274,095

Debt = $ 251,000

Value of the firm = Equity+Debt

                           =  1,274,095 + 251,000

                          = 1,525,095

Value of the firm = $1,525,095

6 0
1 year ago
School band members need to raise money for new uniforms. Some members want to sell energy drinks at a football game, but others
Katen [24]

Answer:

The most influential in making the crucial decision is:

the consumer demand

Explanation:

Before the School Band members finalize on their decision about selling energy drinks and organizing a car wash, they will need to assess the demand for their product or service.  This is critical because without effective demand, supply would be met with negative reactions which will not produce good results, no matter the decision taken.

6 0
1 year ago
Read 2 more answers
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