Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

I was asked to detail each answer. Thankyou in advance Use the information below to answer the following questions. Present and future value tables of

I was asked to detail each answer. Thankyou in advance image text in transcribed
Use the information below to answer the following questions. Present and future value tables of $1 at 1 1% are presented below. PV of S FVA of S1 PVA of $1 FV of $1 1.0000 1.11000 0.90090 0.90090 2.1100 0.81162 1.23210 1.71252 3.3421 1.36763 2.4437 0.73119 3.10245 4.7097 0.65873 1.51807 4 3.69590 6.2278 1.68506 0.59345 7.9129 187041 4.23054 0.53464 1) On October 1, 2018, Justine Company purchased equipment from Napa Inc. in exchange for a noninterest-bearing note payable in five equal annual payments of 500,000, beginning Oct 1, 2019. Similar borrowings have carried an 11% interest rate. The equipment would be recorded at: A) $2,225,000. B) S2,500,000. C) $1,847,950 D) $2,115,270. 2) Mary Alice just won the lottery and is trying to decide between the options of receiving the annual cash flow payment option of $250,000 per year for 25 years beginning today or receiving one lump-sum amount today. Mary Alice can earn 6% investing this money. At what lump-sum payment amount would she be indifferent between the two alternatives? (FV of S1, PV of $1, FVA of S1, PVA of$1, FVAD of S1 and PVAD of S1) A) $3,195,840, D) S6,250,000. C) S3,387,590 B) S3,637,590 3) Chancellor Ltd. sells an asset with a S1 million fair value to Sophie Inc. Sophie agrees to make six equal payments, each to be paid one year apart, commencing on the date of sale. The payments include principal and 6% annual interest. Compute the annual payments A) S166,651 D) $203,351 C) $135,252 B) $191,852

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Police Auditing Theories And Practices

Authors: Allan Y. Jiao

1st Edition

0398069808, 978-0398069803

More Books

Students also viewed these Accounting questions