Answer:
25%
Explanation:
The formula to compute the equity in the long margin account is
long market value - debt = equity
Also we know that the account will be at maintenance if the equity is 25% of the long market value
Here 25% represents the equity so 75% would be debit
And, the drop in the market value is of
= $90,000 ÷ 0.75
= $120,000
So at this point, the equity is $30,000
Now the margin percentage is
= $30,000 ÷ $120,000
= 25%
A customer's restricted margin account shows the following: LMV $30,000 DB $16,000 SMA $0 If the customer sells $2,000 of securities, how much could be withdrawn from the account
Answer: $1000
Explanation:
From the question, we are informed that a customer's restricted margin account shows the following: LMV $30,000 DB $16,000 SMA $0 If the customer sells $2,000 of securities.
Based on the above analysis, the customer can only withdraw $1000. This is because since $2000 worth of securities are sold, half of it which is $1000 will be credited to SMA which is the withdrawable amount.
Which one of the following statements regarding the task of staffing the organization in a manner that facilitates strategy execution is false or inaccurate?
A. The quality of an organization's people is always an essential ingredient of successful strategy execution--knowledgeable, engaged employees are a company's best source of creative ideas for the nuts-and-bolts operating improvements that lead to operating excellence
B. Without a smart, capable, results-oriented management team, the implementation-execution process ends up being hampered by missed deadlines, misdirected or wasteful efforts and/or managerial ineptness.
C. The overriding aim in building a management team should be to replace weak executives who lack strong skills in closely supervising the people who work under them
D. It is difficult for a company to competently execute its strategy and achieve operating excellence without recruiting and retaining a large band of capable, engaged, high-achieving employees
E. In turnaround and rapid-growth situations, and in instances when a company doesn't have insiders with the requisite know-how, filling key management slots from the outside is a standard organization-building approach
Answer: The overriding aim in building a management team should be to replace weak executives who lack strong skills in closely supervising the people who work under them
Explanation: The success of an organization is dependent on several factors including the presence of strategic and result oriented executive within its workforce. This is a vital and important aspect of building and organization capable of withstanding the competirmtuve nature of the market. Being strategic requires smartness, knowledge, experience, expertise and skills in other to make proactive suggestions required to execute groundbreaking projects.
Hence, based on the options provided above, the aim of strategic execution should not be focused on replacing executives who are perceived as being weak.
The internal business perspective of the balanced scorecard answers which of the following questions?
A) How do customers see us?
B) What must we excel at?
C) How do we look to shareholders?
D) Can we continue to improve and create value?
Answer:
B) What must we excel at?
Explanation:
The internal business perspective is about improving the company's internal processes by focusing and exploiting the company's core competencies. What actions and decisions are needed in order for us to excel and increase customer satisfaction.
A) How do customers see us? ⇒ CUSTOMER PERSPECTIVE
C) How do we look to shareholders? ⇒ FINANCIAL PERSPECTIVE
D) Can we continue to improve and create value? ⇒ INNOVATION AND LEARNING PERSPECTIVE
To boost company recognition, Carlos, the president of StreetLife Entertainment, makes daily blog entries.
a. Nonterritorial offices
b. Emphasis on ethics
c. Changing communication technologies
Explanation:
c) Changing communication technologies
In this case, it can be said that the company StreetLife Entertainment uses new communication technologies to apply positive changes with regard to the company's positioning.
By using communicating also through blogs, which is a social media, Carlos increases the company's recognition through the possibility of establishing a more informal communication that generates identification and value for readers, which consequently generates engagement and increases the company's recognition .
The use of new communication technologies can establish the creation of a more integrated relationship between company and consumer, in addition to being a positive strategy to generate value, attest the company's potential to stakeholders and increase its reliability in the market.
Changing communication technologies is a main point to boost company recognition, Carlos, the president of StreetLife Entertainment, makes daily blog entries.
Changing communication technologies:It is stated that the company StreetLife Entertainment uses new communication technologies to modify positive changes with respect to the changes of the company is a very positive way.By using communicating through social platforms, Carlos increases the recognition of the company through the risk of developing a more informal communication that generates identification, and Value for readers, which consequently generates engagement and increases the company's recognition . It creates the relationship between company and its consumer, in addition of positive impact.
Therefore, To boost company recognition, Carlos, the president of Street Life Entertainment, makes daily blog entries is to Changing communication technologies. so, the option [C] is correct.
Learn more about communication technologies refer;
https://brainly.com/question/1495177
Which of the following is one of the three standard sections of a governmental comprehensive annual financial report?
a) Statistical.
b) Single audit.
c) Actuarial.
d) Investment.
Answer:
a) Statistical.
Explanation:
The three standard sections of a governmental comprehensive annual financial report are:
IntroductoryFinancial: includes financial statements and notes Statistical: include statistical data about relevant financial information and trends, and how they relate to government activitiesWhen a DSS is built, used successfully and integrated into the company's business processes, it was most likely built for a(n)
Answer:
recurrent decision
Explanation:
In such a scenario, it was most likely built for a recurrent decision. This is because a DSS stands for a decision support system and is an information system that supports organizational decision making as well as many business activities in order to allow a company to improve the overall quality, reliability, and efficiency of their work through recurrent decisions.
Three groups that participate in the process of establishing GAAP are users, preparers, and auditors. These groups are represented by various organizations. For each organization listed below, indicate which of these groups it primarily represents.
1. Securities and Exchange Commission
2. Financial Executives International
3. American Institute of Certified Public Accountants
4. Institute of Management Accountants
5. Association of Investment Management and Research
E 1-5 Participants in establishing GAAP. Three groups that participate in the process of establishing GAAP are users, preparers, and auditors.
Answer:
The name of a group is based on whether the group is a user of GAAP or a preparers of GAAP or an auditor of GAAP
The group which an organization represents should be indicated as follows:
Organisation Group
1. Securities and Exchange Commission Preparers
2. Financial Executives International Users
3. American Institute of Certified Public Auditors
Accountants
4. Institute of Management Accountants Users
5. Association of Investment Management Users
and Research
Keeping your ___ and ___in mind will dictate what you say and how you say it.
Answer:
Audience and purpose.
Hopefully this helps! :)
If real gross domestic product (GDP) grew by 2 percent and the inflation rate was 2 percent, then nominal GDP grew by
Answer:
4%
Explanation:
If the real gross domestic product for the year grew by 2%
The inflation rate also grew by 2%
Then nominal GDP rate can be calculated as follows
= Real GDP + inflation rate
= 2% + 2%
= 4%
Hence the nominal gross domestic product grew by 4%
In the United States, sole proprietorships and partnerships outnumber corporations.a. Trueb. False
Answer:
a. True
Explanation:
The sole proprietorship and partnerships outnumber corporations in United States but they net fewer sales and less income than corporations, individually and when combined.
A stock had returns of 16 percent, 12 percent, 19 percent, 17 percent, 18 percent, and -1 percent over the last six years.
What is the arithmetic return for the stock?
What is the geometric return for the stock?
Answer:
What is the arithmetic return for the stock?
arithmetic returns basically refer to the mean (or average) of the returns = (16% + 12% + 19% + 17% + 18% - 1%) / 6 = 81% / 6 = 13.5%What is the geometric return for the stock?
geometric returns involves multiplying the returns and then squaring them = ⁶√(1.16 x 1.12 x 1.19 x 1.17 x 1.18 x 0.99) - 1 = 1.1328 - 1 = 0.1328 = 13.28%Normally, geometric returns are lower than arithmetic returns, and they represent compounding rates.
You manage a risky portfolio with an expected rate of return of 18% and a standard deviation of 28%. The T-bill rate is 8%.
A. Your client chooses to invest 70% of a portfolio in you fund and 30% in an essentially risk-free money market fund. What is the expected value and standard deviation of the rate of return on his portfolio?
B. Suppose that your risky portfolio includes the following investments in the given proportions:
Stock A 25%
Stock B 32%
Stock C 43%
What are the investment proportions of your client's overall portfolio, including the position in T-bills?
C. What is the reward-to-volatility (Sharpe) ratio (S) of you risky portfolio? Your clients?
D. Draw the CAL of your portfolio on an expected return-standard deviation diagrm. What is the slop of the CAL? Show the position of your client on your fund's CAL.
Answer:
a) the expected value (rate of return) is 15% and standard deviation of the rate of return on his portfolio is 19.6%
b)
17.5% in Stock A,
22.4% in Stock B,
30.1% in Stock C.
The fraction invested in T-bills is 30%.
c)
The reward to visibility ratio = 35.7 %
client's portfolio offers the same reward to visibility ratio = 35.7%
d)
the CAL is drawn in the image uploaded along this answer,
the slope of the CAL is the reward to visibility ratio, i.e 35.7%. The client's portfolio is the one providing an expected return E[rc] and standard deviation σc.
Explanation:
a)
Let c represent client’s portfolio and f represent money-market fund while p represent the risky portfolio.
so
E[rc] = E[70%rp + 30%rf ] = 70%Erp + 30%rf
= (70/100 × 0.18) + (30/100 × 0.08) = 15%
∴ the expected value (rate of return) is 15%
Since σf = 0,
standard deviation of client’s portfolio is calculated as;
σc = 0.7σp
σc = 0.7 × 0.28 = 19.6%
∴ standard deviation of the rate of return on his portfolio is 19.6%
b)
we know that portfolio c is 70% invested in p, which means
70/100 × 0.25 = (0.175) 17.5% in Stock A,
70/100 × 0.32 = (0.224) 22.4% in Stock B,
70/100 × 0.43 = (0.301) 30.1% in Stock C.
The fraction invested in T-bills is 30%.
c)
The reward to visibility ratio of fund is given as
(E(rp) - rf) / σp = (0.18 - 0.08) / 0.28 = ( 0.357) = 35.7 %
Now the client's portfolio offers the same reward to visibility ratio
(E(rc) - rf) / σc = (0.15 -0.08) / 0.196 = ( 0.357) = 35.7 %
d)
the CAL is drawn in the image uploaded along this answer,
the slope of the CAL is the reward to visibility ratio, i.e 35.7%. The client's portfolio is the one providing an expected return E[rc] and standard deviation σc.
The year-end adjusted trial balance of the Timmons Tool and Die Corporation included the following account balances: retained earnings, $310,000; dividends, $48,000; sales revenue, $970,000; cost of goods sold, $670,000; salaries expense, $150,000; rent expense, $47,000; and interest expense, $21,000. Prepare the necessary closing entries.
Answer:
1. Journal - Closing Entries
Date Account Titles Debit Credit
Sales Revenue $970,000
Income summary $970,000
(Closing of revenue account)
2. Closing the expenses accounts as necessary
Journal - Closing Entries
Date Account Titles Debit Credit
Income summary $888,000
Cost of goods sold $670,000
Salary expenses $150,000
Rent expenses $47,000
Interest expenses $21,000
(Closing of expenses account)
3. Closing net Income
Journal - Closing Entries
Date Account Titles Debit Credit
Income summary $82,000
Retained earning $34,000
Dividends $48,000
(Closing of net income)
Chutney Channel is a small organization based in Canada that sells specialty condiments made from local ingredients to a wide array of customers around the global. Chutney Channel would be characterized as a(n) __________ organization.
Answer:
he
Explanation:
I
Chutney Channel is a small organization based in Canada that sells specialty condiments made from local ingredients to a wide array of customers around the global. Chutney Channel would be characterized as a multi-national organization or business.
What is a business?A business can be referred to as an organization or enterprising entity that engages in professional, commercial or industrial activities. There are different types of businesses like sole proprietorships, partnerships, corporations, and more.
The businesses are basically work for profit motive. Businesses can be small-scale or large-scale. Some of the biggest businesses in the world are Amazon and Walmart.
There are different types of partners in a business. The persons who owns the shares of the company is known as shareholder.
Chutney Channel is a small organization based in Canada that sells specialty condiments made from local ingredients to a wide array of customers around the global. Chutney Channel would be characterized as a multi-national organization or business.
Learn more about business here:
https://brainly.com/question/2190762
#SPJ5
An investor borrows an amount at an annual effective interest rate of 5% and will repay all interest and principal in a lump sum at the end of 10 years. She uses the amount borrowed to purchase a 1000 par value 10-year bond with 8% semiannual coupons bought to yield 6% convertible semiannually. All coupon payments are reinvested at a nominal rate of 4% convertible semiannually. Calculate the net gain to the investor at the end of 10 years after the loan is repaid
Answer:
$74.14
Explanation:
first we must calculate the market price of the bond:
0.03 = {40 + [(1,000 - MV)/20]} / [(1,000 + MV)/2]
0.03 x [(1,000 + MV)/2] = 40 + [(1,000 - MV)/20]
0.03 x (500 + 0.5MV) = 40 + 50 - 0.05MV
15 + 0.015MV = 90 - 0.05MV
0.065MV = 75
MV = 75 / 0.065 = $1,153.85
so the customer borrowed $1,153.85
in 10 years, the principal + interest will = $1,153.85 x (1 + 5%)¹⁰ = $1,879.50
the customer will receive:
20 semiannual payments of $40, the future value = $40 x 22.841 (FV annuity factor, 2%, 19 periods) + $40 = $953.64
bond's face value = $1,000
total money received = $1,000 + $953.64 = $1,953.64
net gains = $1,953.64 - $1,879.50 = $74.14
Collateralized mortgage obligation (CMO) tranche A has been created to have the most predictable near-term principal pay off. A tranche set up in this way will have
Answer: d. a lower yield
Explanation:
When a security is said to bring back predictable returns it means the security is of lower risk. A CMO tranche that has the most predictable near-term principal pay off is therefore the one with the a lower risk.
Riskier securities command higher yield than less riskier ones as a way to compensate the holder for taking on more risk. With tranche A having the lower risk, it will have a lower yield.
which method of entering a foreign market has a domestic firm actively managing a foreign company or overseas facility
Complete Question:
Which method of entering a foreign market has a domestic firm actively managing a foreign company or overseas facility?
Group of answer choices
A. joint venture
B. direct ownership
C. exporting
D. licensing
E. contract manufacturing
Answer:
B. Direct ownership.
Explanation:
Direct ownership is a method of entering a foreign market that has a domestic firm actively managing a foreign company or overseas facility.
Generally, it considered to be a good option when there exist similarities between the domestic and foreign cultures and when political risks associated with the market are very minimal or little.
However, direct ownership is considered to be the riskiest method of entering a foreign market and it typically requires more commitment from the business owner than any other method of entering a foreign market such as joint ventures, exporting, licensing, contract manufacturing, piggybacking, franchising etc.
Suppose Kansas Corp. purchased this equipment on July 17, 20X6, and sold it on April 19, 20X8, for $95,000. The amount of gain or loss is:
Answer:
loss on sale: ($10,000)
Explanation:
some information is missing, so I looked it up:
the equipment was purchased at $140,000
estimated useful life: 5 years
residual value: $40,000
using straight line depreciation, the depreciation expense per year = ($140,000 - $40,000) / 5 years = $20,000
total depreciation expense between purchase and sale:
mid-month July 20x6 - mid-month July 20x7 = $20,000
mid-month July 20x7 - mid-month April 20x8 = $20,000 x 9/12 = $15,000
carrying value at the moment of sale = $140,000 - $35,000 = $105,000
loss on sale = $95,000 - $105,000 = ($10,000)
Monga manufactures cell phones. The conversion costs to produce cell phones for November are added evenly throughout the process in the Assembly Department. The company uses the weighted-average method. For each of the following separate assumptions, calculate the equivalent units of production for conversion costs in the ending Work-in-Process Inventory for the Assembly Department:
1. 15,000 cell phones were 75% complete
2. 20,000 cell phones were 25% complete
First, determine the formula for calculating equivalent units of production. (Abbreviation used: WIP-Work-in-Process Inventory)
Equivalent units of production
Assumption 1. 15,000 cell phones were 75% complete
The equivalent units for conversion costs is
Assumption 2. 20,000 cell phones were 25% complete
The equivalent units for conversion costs is
Answer:
Monga
Equivalent units of production for conversion costs in the ending Work-in-process Inventory for the Assembly Department:
The equivalent unit of production is the degree of completion of production. It is given by the formula: units under production x degree of completion.
Assumption 1: 15,000 cell phones were 75% complete
The equivalent units for conversion costs is 11,250 cell phones
Assumption 2. 20,000 cell phones were 25% complete
The equivalent units for conversion costs is 5,000 cell phones
Explanation:
Monga's equivalent units of production in Ending WIP Inventory shows the product of the degree completion and the units under production at the ending period. It is a way of determining how much cost has been incurred in production so that the appropriate cost can be attributed to each stage of the production process. Equivalent units calculation is, therefore, a way of assigning weights to units in the process of production.
If Ct denotes consumption, It denotes investment, and Yt is output, the resource constraint in the Solow model is: Group of answer choices
Answer: Yt = Ct + It
Explanation:
If Ct denotes consumption, It denotes investment, and Yt is output, the resource constraint in the Solow model is Yt = Ct + It.
The Solow model believes that when there is a sustained increase in the capital investment, there is a temporary rise in growth rate. It should be noted that savings equals investment and also income is the addition of consumption and savings. Therefore,
Yt = Income
Ct = Consumption
It = Investment = Savings
Therefore, Yt = Ct + It
Janice has car insurance that she must pay four times a year. If each payment is $156, how much money should she set aside each month to cover her car insurance?
Answer:
Cheap Florida Auto Insurance. Low Rates from $53.99 / Month!
Explanation:
________ make tactical decisions, which deal with activities such as short-term planning, organizing, and control.
Answer:
Middle managers.
Explanation:
A middle manager refers to an individual who acts as an intermediary between the executive management (top or senior) and the lower (junior) level staffs in an hierarchical organization.
Middle managers make tactical decisions, which deal with activities such as short-term planning, organizing, and control. They are saddled with the responsibility of controlling and supervision of their subordinates (junior employees), as well as presenting innovative ideas and opportunities to the executive management team.
Match the following regulations to their appropriate categories.a. Non-compatible materials must be segregated in storage b. It must be stacked on level and solidly supported sills c. All materials stored in tiers must be stacked, racked, blocked, interlocked or otherwise secured to prevent sliding, falling or collapse d. Keep storage areas free from accumulated materials that cause tripping, fires or explosions, or that may contribute to harboring rats and pests 1. Lumber material storage 2. Special type material storage 3. General material storage 4. Housekeeping
Answer:
a. Non-compatible materials must be segregated in storage - Special type material storage
Non-compatible materials means that materials are of a special type and not of the normal ones used and so this regulation relates to Special type material storage
b. It must be stacked on level and solidly supported sills - Lumber material storage
For lumber not to get damaged it needs to be stored in a certain way being that it should be stacked on level and solidly supported sills so this relates to Lumber storage.
c. All materials stored in tiers must be stacked, racked, blocked, interlocked or otherwise secured to prevent sliding, falling or collapse. - General material storage
This relates to general material storage as it is a standard method of storage aimed at preventing potential dangers.
d. Keep storage areas free from accumulated materials that cause tripping, fires or explosions, or that may contribute to harboring rats and pests. - Housekeeping
Housekeeping is done to keep the storage as free from calamity as possible so this regulation falls here.
The sales strategy of getting at least one additional lead from each person interviewed is called selling deeper.a. Trueb. False
Answer:
True
Explanation:
The biggest transportation mode in terms of spending is: a. Rail b. Trucking c. Air d. Ocean e. Pipeline
Answer:
Air
Explanation:
In terms of spending, the biggest mode of transportation is air transportation. It is used to convey items that are perishable and that have relatively high value.
Sophia Martin's goal has been to travel around the world. She has now been traveling for six months and she has decided she is a little tired of living out of a suitcase. She has decided to go home, look for a part time job, and take shorter trips to locations around the world that appeal to her. Which step in the financial planning process does this scenario most likely demonstrate?
Answer:
Identifying alternative course of action
Explanation:
In this scenario Sophia made an initial financial plan in which she would travel around the world.
As she gets tired of this line of action she can identify other activities that will better suit her. So when she decides to go home, look for a part time job, and take shorter trips to locations around the world that appeal to her. She is identifying alternative course of action.
This new action will eventually have financial implications when implemented. In this case coming home and making only short trips will save her more money. She will also get money from her job.
Which of the following items would be included on the capital expenditures budgeta. spending for adding a new product line.
b. spending for admin fees
c. spending for labor.
d. spending for utili.ties.
Answer:
A
Explanation:
Capital expenditures are a long-term investment. It is the purchase of assets with a useful life of at least one year
The market consensus is that Analog Electronic Corporation has an ROE = 9%, a beta of 1.25, and plans to maintain indefinitely its traditional plowback ratio of 2/3. This year’s earnings were $3 per share. The annual dividend was just paid. The consensus estimate of the coming year’s market return is 14%, and T-bills currently offer a 6% return. a. Find the price at which Analog stock should sell. (Do not round intermediate calculations. Round your answer to 2 decimal places.) b. Calculate the P/E ratio. (Do not round intermediate calculations. Round your answer to 2 decimal places.) c. Calculate the present value of growth opportunities. (Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to 2 decimal places.) d. Suppose your research convinces you Analog will announce momentarily that it will immediately reduce its plowback ratio to 1/3. Find the intrinsic value of the stock.
Answer:
a. Analog stock should sell at $10.60.
b. Trailing P/E ratio is 3.53, and Leading P/E ratio is 3.33.
c. The present value (PV) of growth opportunities is -$9.28.
d. The intrinsic value of the stock is $15.85.
Explanation:
From the question, we have the following:
ROE = 9%
b = beta = 1.25
pr = Plowback ratio = 2/3 = 0.67
dpr = dividend payout ratio = 1- pr = 1/3 = 0.33
e0 = This year’s earnings per share = $3
mr = The coming year’s market return = 14%
tr = T-bills return = 6%
Therefore, we can now have:
a. Find the price at which Analog stock should sell. (Do not round intermediate calculations. Round your answer to 2 decimal places.)
This can be estimated by employing the following formula:
P0 = d * (1 + g) / (r - g) …………………………. (1)
Where;
P0 = Stock Price = ?
d = dividend per share = e0 / dpr = $3 / (1 / 3) = $1
g = Sustainable growth rate = ROE * pr = 9% * 2/3 = 0.06
rf = Risk free rate = Return on T-bills = 6%
b = Beta = 1.25
mr = Market return = 14%
r = Required return on Equity = rf + b * (mr - rf) = 6% + 1.25 * (14% - 6%) = 0.16
Substituting the values into equation (1), we have:
P0 = $1 * (1 + 0.06) / (0.16 – 0.06)
P0 = $1 * 1.06 / 0.10
P0 = $10.60
b. Calculate the P/E ratio. (Do not round intermediate calculations. Round your answer to 2 decimal places.)
P/E ratio can be Trailing P/E ratio or Leading P/E ratio as follows:
Trailing P/E ratio = P0/E0 = $10.60 / $3 = 3.53
Leading P/E ratio = P0/e1 ………………………………………. (2)
Where;
e1 = e0 * (1 + g) = $3 * (1 + 0.06) = 3.18
Substituting the values into equation (2), we have:
Leading P/E ratio = $10.60 / 3.18 = 3.33
c. Calculate the present value of growth opportunities. (Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to 2 decimal places.)
P0 = e1 / r + pvgo …………………………………… (3)
Where pvgo denotes present value of growth opportunities.
Since already obtained P0, e1 and r in part a and b, we just substitute them equation (3) and solve for pvgo, we have:
$10.60 = $3.18 / 0.16 + pvgo
$10.60 = $19.875 + pvgo
pvgo = $10.60 - 19.875
pvgo = -$9.28
d. Suppose your research convinces you Analog will announce momentarily that it will immediately reduce its plowback ratio to 1/3. Find the intrinsic value of the stock.
The intrinsic value of a stock refers to the stock price based only on the internal factors of a company.
Base on this new information, we have the following:
g = ROE * pr = 9% * (1 / 3) = 3%
dpr = 1 – pr = 1 - 1/3 = 2/3
d = dividend per share = e0 / dpr = $3 / (2 / 3) = $2
P0 = d * (1 + g) / (r - g) = $2 * (1 + 3%) / (0.16 – 3%)
P0 = $2 * (1 + 3%) / (0.16 – 3%)
P0 = $15.85
Therefore, the intrinsic value is $15.85.
2. Earl Broker is 25 years old, senior in college and he decides to put $150 every year in a Roth IRA through Vanguard Total
Stock Market ETF. It gives the return of 10%. Find the total sum he will receive when he will withdraw the money in his
65th birthday.
$66,38.8.86
O $68,588.48
O C$60,688.58
O $65,688
Answer: a) $66,388.86
the total sum Earl will receive when he withdraws the money in his 65th birthday is $66,388.86
Explanation:
Given that;
Annuity = $150
r = 10%
Earl is 25years now
Earl plans to withdraw the money when he is 65
which mean Period N = ( 65 - 25 ) = 40
To find the future value, we use use the express
Future value = annuity × (((1+r)^n)-1)/r)
we substitute our values
Future Value = 150 × (((1 + 10/100)^40)-1)/10/100)
= 150 × (((1.10)^40)-1) / 0.01)
150 × ((45.2592 - 1)/0.1)
150 × 442.5924
Future Value = $66,388.86
therefore the total sum Earl will receive when he withdraws the money in his 65th birthday is $66,388.86
Lee Company purchased goods from Kelly with the following terms and details. Sales price, $6,000 Terms, (4/10, n/30) Date of sale, January 1 Date of payment, January 14 Shipping, FOB Destination, $115, prepaid by seller Determine if Lee, the buyer, qualifies for a cash discount, and who pays for shipping, Lee or Kelly.
Answer:
the question is not very clear about when the goods arrived at Lee Company. The discount term starts to count as soon as the goods are delivered since this is a FOB destination sale (title passes only after goods are delivered to the buyer's warehouse).
Assuming that the goods were delivered the same day as they were shipped, January 1, the discount period ends January 11. Since the payment was done on January 14, there is no cash discount.
Since this is a FOB destination sale, the freight charges are paid by the seller (Kelly).