Answer and Explanation:
The journal entry is shown below:
Cash $8,730
Sales Discount ($9,000 × 3%) $270
To Accounts receivable $9,000 ($10,000 - $1,000)
Here cash and sales discount is debited as it increased the assets and discount while on the other hand the account receivable should be credited as it reduced the assets
Which of the following statements about annuities are true? Check all that apply. An ordinary annuity of equal time earns less interest than an annuity due. Annuities are structured to provide fixed payments for a fixed period of time. When equal payments are made at the beginning of each period for a certain time period, they are treated as ordinary annuities. When equal payments are made at the beginning of each period for a certain time period, they are treated as an annuity due.
Answer:
The true statements are:
Annuities are structured to provide fixed payments for a fixed period of time.
When equal payments are made at the beginning of each period for a certain time period, they are treated as an annuity due.
Explanation:
Annuities provide fixed payments for a lifetime or a specified period of time. With equal payments at the beginning of each period for a fixed period of time, the annuity is regarded as an annuity due. But with equal payments at the end of the period, it is an ordinary annuity. A common example of annuity due is payment for Rent at the beginning of the month or year. If the Rent is paid at the end of the month or year, it is an ordinary annuity.
Chen Company's Small Motor Division manufactures a number of small motors used in household and office appliances. The Household Division of Chen then assembles and packages such items as blenders and juicers. Both divisions are free to buy and sell any of their components internally or externally. The following costs relate to small motor LN233 on a per unit basis.
Fixed cost per unit $5.20
Variable cost per unit $10.81
Selling price per unit $34.55
Assuming that the Small Motor Division has excess capacity, compute the minimum acceptable price for the transfer of small motor LN233 to the Household Division. (Round answer to 2 decimal places.)
Minimum transfer price $ per unit
Assuming that the Small Motor Division does not have excess capacity, compute the minimum acceptable price for the transfer of the small motor to the Household Division. (Round answer to 2 decimal places.)
Answer:
See below
Explanation:
1. If the small motor division has excess capacity,
Minimum transfer price = Variable cost + Opportunity cost
Variable cost per unit = $10.81
Add:
Opportunity cost per unit = $0.00 (Because the company has sufficient excess capacity)
Minimum transfer price = $10.81
2. If the small motor division has excess capacity,
Minimum transfer price = Variable cost + Opportunity cost
Variable cost per unit = $10.81
Add:
Opportunity cost per unit = $23.74 (As the company has no excess capacity, contribution lost is the opportunity cost)
Minimum transfer price = $34.55
N.B
Contribution lost = Selling price per unit - Variable cost per unit
= $34,55 - $10.8 = $23.74
Answer each of the following independent questions. Required: Alex Meir recently won a lottery and has the option of receiving one of the following three prizes: (1) $88,000 cash immediately, (2) $34,000 cash immediately and a six-period annuity of $9,300 beginning one year from today, or (3) a six-period annuity of $18,400 beginning one year from today. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) 1.1 Assuming an interest rate of 7%, determine the PV value for the above options.
1.2 Which option should Alex choose? Option (1) Option (2) Option (3)
2. The Weimer Corporation wants to accumulate a sum of money to repay certain debts due on December 31, 2022. Weimer will make annual deposits of $175,000 into a special bank account at the end of each of 10 years beginning December 31, 2013. Assuming that the bank account pays 8% interest compounded annually, what will be the fund balance after the last payment is made on December 31, 2022?
Table of calculation function?
Payment?
N?
I?
Future value?
Answer:
option 1
$4,056,237.49
Explanation:
To determine the better option, we have to determine the present value of options 2 and 3
Present value is the sum of discounted cash flows
Present value can be calculated using a financial calculator
option 2
Cash flow in year 0 = $34,000
Cash flow in year 1 to 6 = $9,300
I = 7 %
PV = 78,328.82
Option 2
Cash flow in year 1 to 6 = $$18,400
I = 7 %
PV = 87704.33
To find the NPV using a financial calculator:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. after inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.
3. Press compute
It is the first option that has the highest value
The formula for calculating future value = A / annuity factor
Annuity factor = {[(1+r) n] - 1} / r
P = Present value
R = interest rate
N = number of years
Setrakian Industries needs to raise $48.5 million to fund a new project. The company will sell bonds that have a coupon rate of 5.56 percent paid semiannually and that mature in 10 years. The bonds will be sold at an initial YTM of 6.13 percent and have a par value of $2,000. How many bonds must be sold to raise the necessary funds
Answer:
25,317 unit
Explanation:
Current price of bond = PV(Rate, Nper, Pmt, Fv)
Current price of bond = PV(6.13%/2, 10*2 ,5.56%/2*2000, 2000)
Current price of bond = $1,915.71
Number of bonds to issue = $48,500,000 / $1,915.71
Number of bonds to issue = 25316.98430
Number of bonds to issue = 25,317 unit
The cost of direct materials transferred into the Bottling Department of the Mountain Springs Water Company is $327,600. The conversion cost for the period in the Bottling Department is $528,000. The total equivalent units for direct materials and conversion are 25,200 and 8,800 liters, respectively. Determine the direct materials and conversion cost per equivalent unit. Round your answers to the nearest cent. $fill in the blank 1 per equivalent unit of materials $fill in the blank 2 per equivalent unit of conversion costs
Answer:
$13 per Equivalent Unit of Materials,
$60 per Equivalent Unit of Conversion Costs
Explanation:
Calculation to Determine the direct materials and conversion cost per equivalent unit
Direct materials equivalent units=($327,600/25,200 liters )
Direct materials equivalent units=$13
Conversion Costs equivalent units
=($528,000/8,800 liters)
Conversion Costs equivalent units= $60
Your job pays you only once a year for all the work you did over the previous 12 months. Today, December 31, you just received your salary of $58,000 and you plan to spend all of it. However, you want to start saving for retirement beginning next year. You have decided that one year from today you will begin depositing 3 percent of your annual salary in an account that will earn 11 percent per year. Your salary will increase at 6 percent per year throughout your career.
Required: How much money will you have on the date of your retirement 40 years from today?
Answer:
The amount you will have on the date of your retirement 40 years from today is $1,904,087.20.
Explanation:
This can be determined using the formula for calculating the future value of growing annuity as follows:
FV = M * (((1 + r)^n - (1 + g)^n) / (r - g)) ...................................... (1)
Where
FV = Future value or the amount on the date of retirement = ?
M = First annual deposit = Annual salary * Deposit percentage = $58,000 * 3% = $1,740
r = annual interest rate = 11%, or 0.11
g = salary growth rate = 6%, or 0.06
n = number of years = 40 years
Substituting all the values into equation (1), we have:
FV = $1,740 * (((1 + 0.11)^40 - (1 + 0.06)^40) / (0.11 - 0.06))
FV = $1,740 * 1,094.30298736951
FV = $1,904,087.20
Therefore, the amount you will have on the date of your retirement 40 years from today is $1,904,087.20.
Below are several names of companies and their founders. Explain whether the business creates and sells innovative products or uses innovative methods or both
Answer:
my Answer is a products is notikdd
An investor thought that market interest rates were going to decline. He paid $19,000 for a corporate bond with a face value of $20,000. The bond has an interest rate of 10% per year payable annually. If the investor plans to sell the bond immediately after receiving the 4th interest payment, how much will he have to receive in order to make a return of 14% per year? Solve using:
a. tabulated factors
b. the GOAL SEEK tool on a spreadsheet.
Answer:
Answer is explained in the explanation section below.
Explanation:
a. In this part, we need to calculate the present worth using the formula to calculate the sale price of the bond.
As the coupon rate = 10% per year
So,
The Annual dividend will = 2000 = 10% x 20,000
19000 = 2000 (P/A, 14%,4) + B(P/F,14%,4)
19000 = 2000 (2.9137) + B (0.592)
Solving for B = Desired sales price of the bond
B = [tex]\frac{19000 - 5827.4}{0.592}[/tex]
B = 22251
b. Part b of this question is to solve using GOAL SEEK feature of a spreadsheet so, I have attached it in the attachment. Please refer to the attachment for the solution of part b.