You want to buy a house in Whittier CA that costs $1,067,000. You have a down payment equal
to 23% of that price, and you have found a bank that will loan you the remainder (ignore closing
costs, property taxes, etc..). The interest rate on this mortgage is 4.75% p.a. with monthly
compounding (APR), this rate is fixed for 30 years, and payments on the loan are made monthly
(in arrears, as with most mortgages). Assume that you will take out the loan on October 1st, 2020.
What is your monthly mortgage payment? ($4,285.80) On what date is the first payment due and
on what date is the last one due?
2) Create an amortization table for the mortgage described in #1 above.
a. What is the amount of principal paid with the payment made in July 2033? ($1,884.38)
b. What is the amount of interest paid with the payment made in October 2040? ($1,628.54)
In: Finance
Chapter 14 -Long term Liabilities
Problem 14-2
(Issuance and Redemption of bonds) Venezuela Co. is building a new hockey arena at a cost of $2,500,000. It received a down payment of $50,000 from local businesses to support the project, and now needs to borrow $2000,000 to complete the project. It therefore decides to issue $2000,000 of 10.5%, 10-year bonds. These bonds were issued on January 1, 2016 and pay interest annually on each January 1. The bond yield 10%.
Instructions: a) prepare a journal entry to record the issuance of bonds on January 1. 2016
b) prepare a bond amortization schedule up to and including January 1, 2020 using the effective interest method.
c) Assume that on July 1, 2019, Venezuela Co. redeems half of the bonds at a cost of $1,065,000plus the accrued interest. Prepare the journal entry to record this redemption.
In: Accounting
Question 1:
Assume that it is now January 1, 2010. ABC is experiencing is using all the earnings for expansion and therefore, has no dividends. The company will pay a dividend of $1.5 coming 4 years from today. The dividends are expected to grow at a super-normal growth rate of 20% for year 5 and year 6, after which the company achieves a long run growth rate of 6%. Stockholders require a return of 12%.
a. Calculate ABC's non-constant dividends from year 1 to year 6. Also make a time-line.
b. Calculate ABC's horizon value.
c. Calculate the value of the stock today, P̂0.
d. Calculate the expected dividend yield, capital gains yield, and total return expected for 2010.
In: Accounting
Question 1:
Assume that it is now January 1, 2010. ABC is experiencing is using all the earnings for expansion and therefore, has no dividends. The company will pay a dividend of $1.5 coming 4 years from today. The dividends are expected to grow at a super-normal growth rate of 20% for year 5 and year 6, after which the company achieves a long run growth rate of 6%. Stockholders require a return of 12%.
a. Calculate ABC's non-constant dividends from year 1 to year 6. Also make a time-line.
b. Calculate ABC's horizon value.
c. Calculate the value of the stock today, P̂0.
d. Calculate the expected dividend yield, capital gains yield, and total return expected for 2010.
In: Accounting
A 2010 study asserts that the number of hours that the average college student studies each week has been steadily dropping (The Boston Globe, July 4, 2010). In fact, the researchers state that, in the U.S., today’s undergraduates study an average of 14 hours per week. Suppose an administrator at a local university wants to show that the average study time of students at his university differs from the national average. He takes a random sample of 35 students at is university and finds that the average number of hours spent studying per week is 16.3. Assume that the population standard deviation is 7.2 hours. At 0.05 level of significance, what is the test statistics for testing the hypotheses H0: µ = 14 versus H1: µ ≠ 14?
In: Statistics and Probability
Cost allocation responsibility accounting ethics In 2019, only 806,840 Deliman meals were produced and sold to the hospitals. Smith suspects that hospital controllers had systematically inflated their 2010 meal estimates.
1. Recall that Deliman uses the master-budget capacity utilization to allocate fixed costs and to price meals. What was the effect of production-volume variance on Deliman’s operating income in 2010?
2. Why might hospital controllers deliberately overestimate their future meal counts?
3.What other evidence should Deli One’s controller seek to investigate Smith’s concerns?
4. Suggest two specific steps that Deli One’s controller might take to reduce hospital controllers’ incentives to inflate their estimated meal counts.
In: Statistics and Probability
Long-lived assets
Make necessary journal entries
1. On Jan 1, 2010 Hampton purchased equipment at a cost of $400,000! installation cost is $20,000. The equipment has a 10 year life and an expected salvage value at the end of 10 yrs. of 20,000
2. On Dec 31, 2010 Hampton determined that the fair value of the equipment was 390,000. No impairment loss is incurred.
3. On Jan 1st, 2011 Hampton revised the useful life of the computers to a total of 14 years to replace the original assumption of 10 years and the salvage value to $30,000
4. On Dec 31,2011 Hampton determined that the fair value of the equipment was $320,000 and an impairment loss is incurred.
5. On March 31, 2012 Hampton sold the equipment for $320,000
In: Accounting
ACT and SAT scores are both known to be normally distributed. In 2017, the mean and standard deviation for the ACT were μ=20 and σ=6, respectively. The mean and standard deviation for the SAT were μ=1060 and σ=200, respectively. a. What ACT score would place a student in the same percentile as a student who scored 1310 on the SAT in 2010? (In other words, what ACT score is "equivalent" to an SAT score of 1310?) Round your answer to the nearest integer. b. What SAT score would place a student in the same percentile as a student who scored 14.6 on the ACT in 2010? (In other words, what SAT score is "equivalent" to an ACT score of 14.6?) Round your answer to the nearest integer.
In: Statistics and Probability
The null, Ho, indicates that there is either no relationship or a positive relationship between Amazon’s growth over the past ten years and number of Best Buy brick and mortar locations. The alternative, H1, seeks to prove that there is a negative relationship between the variables, Amazon and Best Buy brick and mortar locations. In other words, Amazon’s growth is negatively impacting Best Buy by forcing store location closures. Using a 95% confidence interval, construct a test of hypothesis using the following data:
| Total number of Best Buy stores worldwide 2010-2019 | |
| 2010 | 1,565 |
| 2011 | 1,550 |
| 2012 | 1,711 |
| 2013 | 1,779 |
| 2014 | 1,779 |
| 2015 | 1,732 |
| 2016 | 1,632 |
| 2017 | 1,581 |
| 2018 | 1,514 |
| 2019 | 1,238 |
In: Statistics and Probability
Neuroinvasive West Nile virus refers to a severe disease that affects a person’s nervous system. It is spread by the Culex species of mosquito. In the United States in 2010 there were 629 reported cases of neuroinvasive West Nile virus out of a total of 1021 reported cases, and there were 486 neuroinvasive reported cases out of a total of 712 cases reported in 2011. Can we conclude that the 2011 proportion of neuroinvasive West Nile virus cases is significantly more than the 2010 proportion of neuroinvasive West Nile virus cases? If you conduct hypothesis testing, you have to consider:
Group of answer choices
a test of two proportions
a test of two independent means
a test of a single mean
a test of a single proportion.
In: Statistics and Probability