Question
1. You have a goal of having $220,000 five years from today. The return on the investment is expected to be 10% and will be
1. You have a goal of having $220,000 five years from today. The return on the investment is expected to be 10% and will be compounded semi-annually. The amount that needs to be invested today is closest to: (Table A.1, Table A.2, Table A.3, and Table A.4) (Use appropriate factor(s) from the tables provided.) |
$135,058.
$135,758.
$110,000.
$146,667.
2. MusicPod's earnings per share ratios were $2.59 and $2.31 respectively for 2015 and 2014. MusicPod's stock was trading at $65 and $59.50 per share at the end of 2015 and 2014 respectively. The company paid cash dividends per share of $0.97 in 2015 and $0.75 in 2014. Total stockholders' equity was $13,692 million and $12,016 million in 2015 and 2014 respectively. The common shares outstanding were approximately 1,788,000 in both 2015 and 2014. MusicPod's price/earnings ratio for 2015 is closest to: |
25.1
2.7
25.8
67.0
3. Rae Company purchased a new vehicle by paying $11,300 cash on the purchase date and agreeing to pay $4,300 every three months during the next five years. The first payment is due three months after the purchase date. Rae's incremental borrowing rate is 8%. The liability reported on the balance sheet as of the purchase date, after the initial $11,300 payment was made, is closest to: (Table A.1, Table A.2, Table A.3, and Table A.4) (Use appropriate factor(s) from the tables provided.) |
$86,000.
$81,611.
$70,311.
$97,300.
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