Answer:
The below solution will guide your believe of what should be appropriate qualitative assumptions for inherent risk.
Explanation:
Answer:
$274,400
Explanation:
Data provided in the question:
Annual income of Tim and Tammy = $56,000
Net worth of Tim and Tammy = $150,000
Now,
Using the easy method
Step 1;
Multiply the annual gross income by 70%
⇒ $56,000 × 0.70
⇒ $39,200
Step 2 :
Multiply the above result with 7
⇒ $39,200 × 7
⇒ $274,400
therefore,
we get the amount of life insurance as $274,400
Answer:
You need to deposit $58,481.53 today.
Explanation:
a) Data and Calculations:
Future value expected = $125,000
Period of investment = 7 years
Interest rate = 11% compounded quarterly
The amount of deposit needed today to earn $125,000 in 7 years at annual interest rate of 11% is calculated as follows:
N (# of periods) 28
I/Y (Interest per year) 11
PMT (Periodic Payment) 0
FV (Future Value) 125000
Results
PV = $58,481.53
Total Interest $66,518.47
Answer:
$60,000
Explanation:
Since Bailey Co. changed their accounting for insurance expense from the cash-basis to the accrual-basis in the current year, and in January of the prior year, Bailey recorded insurance expense of $240,000 for the cash purchase of a four-year insurance policy.
Bailey should report the insurance transaction in the current year's financial statements of an amortization of the insurance expense over the four year period, and take account the portion that pertains to the current year.
Therefore = $240,000 / 4 years = $60,000 per year
Answer:
-$414,444.44
Explanation:
The computation of the net present value is shown below:
Net present value = Initial investment + net cash flows ÷ (required rate of return - projected growth rate)
= -$1,570,000 + $104,000 ÷ (12% - 3%)
= -$1,570,000 + $1,155,555.56
= -$414,444.44
Hence, the net present value is -$414,444.44
Since the net present value comes in negative so the project is rejected
