Answer and Explanation:
According to the scenario, computation of the given data are as follow:-
A).Present Value of the Cash Flow for the Lump Sum Payout
= Prize of Lottery Amount × (1 -Tax Rate)
= $506,300 × (1 - 0.46)
= $506,300 × 0.54
= $273,402
B).Present Value of the Cash Flows for Annuity Payout is
= Annuity Payment × (1 - Tax Rate) × PVIFA 8%,20 Years × (1 + Rate of Return)
= $37,000 × (1 - 0.26) × 9.8181 × (1 + .08)
= $37,000 × 0.74 × 9.8181 × 1.08
= $290,325
c). According to the analysis, $290,325 is more than the $273,402, So he should be chooses option (b) $290,325 as a payout option.
Answer:
Big Five model
Explanation:
The Big Five model also known as the Five Factor Model (FFM) or Ocean or Canoe model is a way of grouping human behavior/traits. This behavior or traits are subject to relationship between words.
The Ocean or Canoe (OCEAN/CANOE) abbreviation is a combination of the first letters of the words of the the five(big five) traits.
Openness to experience, Conscientiousness, Extroversion, Agreeableness, emotional stability(Neuroticism). It can also be rearranged to form CANOE as well.
This five traits are also affected by the upbringing or family cultures as well. Anyone described with any of the above word is most likely to have attributes that exemplify the meaning of the words.
I hope this helps.
Answer:
a. neither the nominal nor the real interest rate rise.
Explanation:
Under Fisher's theory, if the nominal interest rate increases at a higher rate than the inflation rate, then the real interest rate rises. If the inflation rate increases more than the nominal interest rate, then the real interest rate decreases.
Generally, an increase in the money supply decreases the nominal interest rate and increases the inflation rate. That results in both lower nominal interest rates and lower real interest rates.
Answer:
debt-equity ratio results in the lowest possible weighted average cost of capital.
Explanation:
The debt equity ratio measures how well a business's equity can account for its debt.
Weighted average cost of capital is referred to as a business's cost of capital and is the rate a company is expected to pay to its shareholders.
When the debt equity ratio results in the lowest weighted average cost of capital, it indicates that the cost of finding for the company is low. This is the optimal and least expensive capital structure.
Answer: See explanation
Explanation:
a. Predetermined overhead rate will be:
= Administrative costs/Number of users
= 739,500/25,500
= $29 per user
Administrative costs applied to Toot will be:
= Number of users x Predetermined overhead rate
= 8900 x 29
= $258100
Administrative costs applied to Tix will be:
= Number of users x Predetermined overhead rate
= 16600 x 29
= $481400
b. For Toot
Revenue: $1,450,000
Less: Engineering cost: $402,500
Less: Administrative cost: $258,100
Profit = $789400
For Tix:
Revenue: $1,200,000
Less: Engineering cost: $521,875
Less: Administrative cost: $481,400
Profit = $196725
