An investment offers $5,800 per year for 20 years, with the first payment occurring one year from now. a. If the required return is 7 percent, what is the value of the investment today

Answer:

Present value of the investment= $61,445.28

Explanation:

Giving the following information:

Annual payment= $5,800

Number of periods= 20 years

Interest rate= 7%

First, we need to calculate the future value of the investment:

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

A= annual payment

FV= {5,800*[(1.07^20) - 1]} / 0.07

FV= $237,773.86

Now, the present value:

PV= FV / (1 + i)^n

PV= 237,773.86 / (1.07^20)

PV= $61,445.28

The accountant for Fazzi Corp. was preparing a bank reconciliation as of April 30, 2017. The following items were identified: Fazzi's book balance $46,200 Outstanding checks 1,100 Interest earned on checking account 50 Customer's NSF check returned by the bank 500 In addition, Fazzi incorrectly recorded a customer's check in cash receipts as $150; the bank recorded the amount correctly as $510. What amount will Fazzi report as its adjusted cash balance at April 30, 2017

You can display good customer service by

A company purchased a marketable security for $10,000 on 3/3/2013. On 3/30/2013, the company prepared its financial statements and marked the security to its market value, which was $17,500. The security was sold on 4/30/2013 for $15,000. The company used the Trading Securities method to account for the security. The statutory tax rate is 35%. What was the effect of the sale of the security on Income Tax Payable on 4/30/2013

Listed below are several transactions that typically produce either an increase or a decrease in cash. Indicate by letter whether the cash effect of each transaction is reported on a statement of cash flows as an operating (O), investing (I), or financing (F) activity.

a. Sale of Common Stock.
b. Sale of Land
c. Purchase of Treasury Stock
d. Merchandise Sales
e. Issuance of a long-term note payable
f. Purchase of merchandise
g. Repayment of note payable
h. Employee salaries
i. Sale of equipment at a gain.
j. Issuance of bonds

Gullett Corporation had $34,000 of raw materials on hand on November 1. During the month, the Corporation purchased an additional $83,000 of raw materials. The journal entry to record the purchase of raw materials would include a:

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Cost Element Standard (per unit) Actual

Direct materials 8 yards at $4.40 per yard $375,575 for 90,500 yards ($4.15 per yard)
Direct labor 1.2 hours at $13.40 per hour $200,925 for 14,250 hours ($14.10 per hour)
Overhead 1.2 hours at $6.10 per hour (fixed $3.50; variable $2.60) $49,000 fixed overhead $37,000 variable overhead

Overhead is applied on the basis of direct labor hours. At normal capacity, budgeted fixed overhead costs were $49,000, and budgeted variable overhead was $36,400.
Required:
Compute the total, price, and quantity variances for (1) materials and (2) labor.

The per-unit standards for direct labor are 2 direct labor hours at $15 per hour. If in producing 2800 units, the actual direct labor cost was $83200 for 5200 direct labor hours worked, the total direct labor variance is $2800 unfavorable. $800 favorable. $800 unfavorable. $500 unfavorable.

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Creating a Budget
Before you can make a spending plan that works for your particular situation, you'll need to understand your spending priorities. What must you spend money on, and what items do you simply want? First, make sure you understand the following terms:
budget: a plan for saving and spending
expenditure: the amount of money spent
necessity: an item that a person must have, such as housing, clothing, or food
luxury: an item that offers physical comfort or enjoyment but is not necessary for life and health.
1. Classify each of the following expenditures as a necessity or a luxury. If any item can be considered either a necessity or a luxury, depending on the situation, classify it as either.
Expenditure Necessity Luxury Either
a. Auto insurance
b. Clothing for school
c. Concert tickets
d. Dinner for two at the newest
e. restaurant in town Groceries
f. Music downloads
g. Medical treatment for strep throat
h. Theme park tickets
i. New car
j. Rent
k. School lunches
I. School ski trip
m. Cell phone service
2. For those items that you indicated could be either necessities or luxuries, describe when you would consider them necessities and when you would view them as luxuries.
MAKING A BUDGET
3. Income First, write down your weekly income: $______.
4. Expenditures For one week, keep track of all of your expenditures. At the end of the week, put the totals in the table below.
Weekly Expenditure Current Amount
Clothing $
Debt repayment (monthly payment + 4) $
Entertainment $
Food (including groceries, meals
out, and snacks) $
Rent and utilities (monthly payment = 4) $
Transportation (own car, ridesharing, public
transportation, etc.) $
Personal care items $
Other $
Total Weekly Expenditures $
5. Subtract your total expenditures from your weekly income.
6. Revised budget
At the end of the week, did you have any money left? Or did you spend more than you earned? If you want to make better use of your money, take a look at how you're spending it and decide where you can trim expenditures. You may find that you could be spending your money on something you really want.
Weekly Expenditure New Budget Actual Spending
Clothing $ $
Debt repayment (monthly payment + 4) $ $
Entertainment $ $
Food (including groceries, meals out,
and snacks) $ $
Rent and utilities (monthly payment + 4) $ $
Transportation (own car, ridesharing,
public transportation, etc.) $ $
Personal care items $ $
Other $ $
Total Weekly Expenditures $ $
7. Using your revised budget as a guide, record your income and expenses for another week. How much money were you able to save?

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Net income $240,000
Dividends declared and paid $72,000
Market price of common stock on 12/31/2016 $29/share

What amount would Matsui report in its year-end 2016 balance sheet for its investment in Yankee?
a. $1,608,000.
b. $1,368,000.
c. $1,329,600.
d. None of these answer choices is correct.

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b. Borrowed $119 from a bank, signing a short-term note.
c. Provided $54,171 in service to customers during the year, with $23,358 on account and the rest received in cash.
d. Paid $129,574 cash on accounts payable.
e. Purchased $41,983 of inventory on account.
f. Paid payroll, $5,240 during the year.
g. Received $19,043 on account paid by customers.
h. Purchased and used fuel of $1,600 in delivery vehicles during the year (paid for in cash).
i. Declared $598 in dividends at the end of the year to be paid the following year.
j. Incurred $126 in utility usage during the year; paid $93 in cash and owed the rest on account.
Required:
For each of the transactions, prepare journal entries.

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Required:
Prepare the journal entries to (a) update depreciation to July 31, 2022, and (b) record the sale of the equipment.

A newly independent Eastern European nation wants to adopt a floating exchange rate system in order to restore monetary control to its government. Using the monetary autonomy argument, how do this country's ministers justify establishing this system? Trade deficits are determined by the balance between savings and investment in a country, not by the external value of its currency. Unpredictability of exchange rate movements makes business planning difficult. Speculation in exchange rates dampens the growth of international trade and investment. Each country should be allowed to choose its own inflation rate. Variable exchange rates are more receptive to a trade balance.

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a. its ability to represent a complex reality without any simplification.
b. its ability to make clear predictions that are consistent with reality.
c. its simplicity in presenting the essential elements of an otherwise complex reality.
d. b and c.

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