Question

In: Economics

A firm enters into an 8-year contract for materials that cost $90,000 initially and $30,000/yr beginning...

A firm enters into an 8-year contract for materials that cost $90,000 initially and $30,000/yr beginning at the end of the 4th year. The company decides to make a lump sum payment at the end of year 2 to pay off the remainder of the contract. What lump sum is necessary at 8% interest?

Solutions

Expert Solution

Rahul Sunny answered 2 years ago
Next > < Previous

Related Solutions

construct a 10 year amortizing loan table with 8% interest rate. You borrow $30,000 initially and...
construct a 10 year amortizing loan table with 8% interest rate. You borrow $30,000 initially and repay it in your ten equal annual year end payments. show only the first 3 steps.
construct a 10 year amortizing loan table with 8% interest rate. You borrow $30,000 initially and...
construct a 10 year amortizing loan table with 8% interest rate. You borrow $30,000 initially and repay it in your ten equal annual year-end payments. Show only the first three years.
A machine cost $30,000 initially and has no salvage value. The O&M costs in year 1...
A machine cost $30,000 initially and has no salvage value. The O&M costs in year 1 were $10,000 and have been increasing by $2,000 from year 2. The minimum cost life of this machine for a MARR of 10 %. (show your solution) A. 4 years B. 2 years C. 6 years D. None of above
At the beginning of 2021 Carefree Contracting Corporation (CCC) enters into a contract to build a...
At the beginning of 2021 Carefree Contracting Corporation (CCC) enters into a contract to build a home for a customer that is expected to take three years to complete. The contract price is $4,000,000. Completion is scheduled for the end of 2023. CCC's year end is December 31. 2021 2022 2023 Actual costs incurred current year $750,000 $2,250,000 $775,000 actual costs incurred prior years -0- 750,000 3,000,000 Cumulative actual costs incurred to date 750,000 3,000,000 3,775,000 Estimated costs to complete...
Soylent Corp sells $150,000 of energy drinks with a cost of materials at $90,000 and a...
Soylent Corp sells $150,000 of energy drinks with a cost of materials at $90,000 and a cost of production at $22,500. Fixed operating costs are $20,000. a)Determine current profit. b)If Soylent Corp uses the Sales Strategy to increase sales to $250,000, its fixed costs will increase by $10,000. Determine the new profit. Profits increased by what percent? c) If Soylent Corp uses the Supplier Strategy to decrease material costs in order to double profits determine the new material cost. Materials...
Jonas Consulting enters into a contract to provide cost management consulting services over a one-year period...
Jonas Consulting enters into a contract to provide cost management consulting services over a one-year period for $10,000 per month on January 1. At the end of the contract, Jonas will either give the customer a $24,000 refund or be entitled to an additional $24,000, depending on the level of cost savings. The company believes there is an 80% chance that it will be entitled to an additional $24,000 and a 20% chance it will give a refund of $24,000....
Jonas Consulting enters into a contract to provide cost management consulting services over a one-year period...
Jonas Consulting enters into a contract to provide cost management consulting services over a one-year period for $10,000 per month on January 1. At the end of the contract, Jonas will either give the customer a $24,000 refund or be entitled to an additional $24,000, depending on the level of cost savings. The company believes there is an 80% chance that it will be entitled to an additional $24,000 and a 20% chance it will give a refund of $24,000....
PART A (8 marks) Bushman Ltd enters into a contract with Lessor Ltd for the use...
PART A Bushman Ltd enters into a contract with Lessor Ltd for the use of a ship for one year. The ship is to be used to transport wood from central Queensland to the port of Brisbane. Lessor does not have substitution rights. The contract specifies a maximum distance that the ship can be used. Bushman Ltd is responsible for operating the ship from central Queensland to the port of Brisbane and is able to choose the details of the...
Deck Department Engine Department Direct materials 180,000 540,000 Direct labor 30,000 24,000 Manufacturing overhead 90,000 96,000...
Deck Department Engine Department Direct materials 180,000 540,000 Direct labor 30,000 24,000 Manufacturing overhead 90,000 96,000 a. Instructions Compute the following per-unit costs for the month of May. A deck assembly transferred to the Engine Department. Assembling an engine and installing it. A completed lawnmower. Materials used in assembling a deck. Direct labor cost of assembling and installing an engine. b. Which of these unit costs would be most useful to management in evaluating the overall monthly efficiency of the...
Deck Department Engine Department Direct materials 180,000 540,000 Direct labor 30,000 24,000 Manufacturing overhead 90,000 96,000...
Deck Department Engine Department Direct materials 180,000 540,000 Direct labor 30,000 24,000 Manufacturing overhead 90,000 96,000 a. Instructions Compute the following per-unit costs for the month of May. A deck assembly transferred to the Engine Department. Assembling an engine and installing it. A completed lawnmower. Materials used in assembling a deck. Direct labor cost of assembling and installing an engine. b. Which of these unit costs would be most useful to management in evaluating the overall monthly efficiency of the...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT