Please help with the questions in the screenshot below:
Les Moore retired as president of Goodman Snack Foods Company but is currently on a consulting contract for $52,000 per year for the next 11 years. Use Appendix B and Appendix D for an approximate answer, but calculate your final answer using the formula and financial calculator methods. a. If Mr. Moore's opportunity cost (potential return) is 9 percent, what is the present value of his consulting contract? (Do not round intermediate calculations. Round your final answer to 2 decimal places.) Present value b. Assuming Mr. Moore will not retire for two more years and will not start to receive his 11 payments until the end of the third year, what would be the value of his deferred annuity? (Do not round intermediate calculations. Round your final answer to 2 decimal places.) Present value Determine the amount of money in a savings account at the end of 3 years, given an initial deposit of $4,000 and a 4 percent annual interest rate when interest is compounded: Use Appendix A for an approximate answer, but calculate your final answer using the formula and financial calculator methods. (Do not round intermediate calculations. Round your final answers to 2 decimal places.) Future Value a. Annually b. Semiannually C. QuarterlyMr. Dow bought 100 shares of stock at $25 per share. Three years later, he sold the stock for $31 per share. What is his annual rate of return? Use Appendix B for an approximate answer, but calculate your final answer using the financial calculator method. (Do not round intermediate calculations. Round your final answer to 2 decimal places.) Annual rate of return % You are chairperson ofthe investment fund for the Continental Soccer League. You are asked to set up a fund of semiannual payments to be compounded semiannually to accumulate a sum of $210,000 after eight years at a 10 percent annual rate (16 payments). The first payment into the fund is to take place six months from today, and the last payment is to take place at the end ofthe eighth year. Use Appendix A and Appendix C for an approximate answer, but calculate your final answer using the formula and financial calculator methods. a. Determine how much the semiannual payment should be. (Do not round intermediate calculations. Round your final answer to 2 decimal places.) Semi-annual payment On the day after the sixth payment is made (the beginning of the fourth year), the interest rate goes up to an annual rate of12 percent. This new rate applies to the funds that have been accumulated as well as all future payments into the fund. Interest is to be compounded semiannually on all funds. b. Determine how much the revised semiannual payments should be after this rate change (there are 10 payments and compounding dates). The next payment will be in the middle of the fourth year. (Do not round intermediate calculations. Round your final answer to 2 decimal places.) I Revised semi-an nual payment :I The Robinson Corporation has $34 million of bonds outstanding that were issued at a coupon rate of 11.650 percent seven years ago. Interest rates have fallen to 10.850 percent. Mr. Brooks, the Vice-President of Finance, does not expect rates to fall any further. The bonds have 17 years left to maturity, and Mr. Brooks would like to refund the bonds with a new issue of equal amount also having 17 years to maturity. The Robinson Corporation has a tax rate of 30 percent. The undenNriting cost on the old issue was 3.40 percent of the total bond value. The underwriting cost on the new issue will be 2.20 percent of the total bond value. The original bond indenture contained a ve-year protection against a call, with a 7 percent call premium starting in the sixth year and scheduled to decline by one- half percent each year thereafter. (Consider the bond to be seven years old for purposes of computing the premium.) Use Appendix D for an approximate answer but calculate your nal answer using the formula and nancial calculator methods. Assume the discount rate is equal to the aftertax cost of new debt rounded up to the nearest whole percent (e.g. 4.06 percent should be rounded up to 5 percent). a. Compute the discount rate. (Do not round intermediate calculations. Input your answer as a percent rounded up to the nearest whole percent.) b. Calculate the present value of total outflows. (Do not round intermediate calculations and round your answer to 2 decimal places.) onnotauoumows Krawczek Company will enter into a lease agreement with Heavy Equipment Co. where Krawczek will make lease payments over the next ve years. The lease is cancelable and requires equal annual payments of $35,200 per year beginning on January 1 of the rst year. The last payment will be January 1 of year 5, and Krawczek will continue to use the asset until December 31 of that year. Other important information includes the following: . The fair value of the equipment is $235,000. . The applicable discount rate is an 8 percent annual rate. . The economic life of the asset is 10 years. . Krawczek does not guarantee the residual value of the asset at the end of the lease, and it does not expect to keep the asset at the end of the term. . The asset is a standard piece of equipment. a. Is the lease an operating lease or a financing lease? 0 Operating lease 0 Financing lease b. What will be the lease expense shown on the income statement at the end of year 1
