In: Finance
1. Blue Fin started the current year with assets of $716,000, liabilities of $358,000 and common stock of $216,000. During the current year, assets increased by $416,000, liabilities decreased by $58,000 and common stock increased by $291,000. There was no payment of dividends to owners during the year. Based on this information, what was the amount of Blue Fin's retained earnings at the beginning of the year?
2. Blue Fin started the current year with assets of $711,000, liabilities of $355,500 and common stock of $211,000. During the current year, assets increased by $411,000, liabilities decreased by $55,500 and common stock increased by $286,000. There was no payment of dividends to owners during the year.
Use the information above to answer the following question. What was the amount of Blue Fin's change in total stockholders' equity during the year?
3. The first year of operations for a company was Year 1. The
net income for Year 1 was $21,900 and dividends of $12,950 were
paid. In Year 2, the company reported net income of $35,900 and
paid dividends of $5,950. At the end of Year 1, the company had
total assets of $169,000. At the end of Year 2, the company had
total assets of $ $259,000.
What is the amount of retained earnings at the end of Year 2?
In: Accounting
Banko Inc. manufactures sporting goods. The following
information applies to a machine purchased on January 1, Year
1:
| Purchase price | $ | 61,000 | |
| Delivery cost | $ | 5,000 | |
| Installation charge | $ | 1,000 | |
| Estimated life | 5 | years | |
| Estimated units | 155,000 | ||
| Salvage estimate | $ | 5,000 | |
During Year 1, the machine produced 51,000 units, and during Year 2
it produced 53,000 units.
Required
a. Determine the amount of depreciation expense
for Year 1 and Year 2 using straight-line method.
b. Determine the amount of depreciation expense
for Year 1 and Year 2 using double-declining-balance method.
c. Determine the amount of depreciation expense
for Year 1 and Year 2 using units of production method.
d. Determine the amount of depreciation expense
for Year 1 and Year 2 using MACRS, assuming that the machine is
classified as seven-year property. (Round your answers to
the nearest dollar amount.)
MACRS table:
| Year | 5-Year property,% |
7-Year property,% |
||||
| 1 | 20.00 | 14.29 | ||||
| 2 | 32.00 | 24.49 | ||||
| 3 | 19.20 | 17.49 | ||||
| 4 | 11.52 | 12.49 | ||||
| 5 | 11.52 | 8.93 | ||||
| 6 | 5.76 | 8.92 | ||||
| 7 | 8.93 | |||||
| 8 | 4.46 | |||||
In: Accounting
10a- Your firm is evaluating a capital budgeting project. The
estimated cash flows appear below. The board of directors wants to
know the expected impact on shareholder wealth. Knowing that the
estimated impact on shareholder wealth equates to net present value
(NPV), you use your handy calculator to compute the value. What is
the project's NPV? Assume that the cash flows occur at the end of
each year. The discount rate (i.e., required rate of return, hurdle
rate) is 14.4%. (Round to nearest penny)
| Year 0 cash flow | -133,000 |
| Year 1 cash flow | 53,000 |
| Year 2 cash flow | 40,000 |
| Year 3 cash flow | 45,000 |
| Year 4 cash flow | 42,000 |
| Year 5 cash flow | 30,000 |
Answer:
10b- What is the discount rate at which the
following cash flows have a NPV of $0? Answer in %, rounding to 2
decimals.
Year 0 cash flow = -132,000
Year 1 cash flow = 33,000
Year 2 cash flow = 37,000
Year 3 cash flow = 33,000
Year 4 cash flow = 39,000
Year 5 cash flow = 42,000
Year 6 cash flow = 31,000
Answer:
10c- US Robotics is evaluating a new product
line. The CFO asks for an estimate of number of years to recover
the initial investment, ignoring the time value of money. You
realize that this is the payback period. The estimated cash flows
from the new product line appear below. (Answer in years, round to
2 places)
Year 0 cash flow = -83,000
Year 1 cash flow = -41,000
Year 2 cash flow = 31,000
Year 3 cash flow = 33,000
Year 4 cash flow = 44,000
Year 5 cash flow = 37,000
Year 6 cash flow = 38,000
Year 7 cash flow = 34,000
Answer:
In: Finance
Write a C++ program to calculate the price of the annual insurance of a private vehicle according to the following table. Age of the person Model year of the car History of Accident Insurance price Less than 40 years Less than 2015 Yes 20 % more than price of last year No 15 % more than price of last year Later than 2015 Yes 12 % more than price of last year No 10 % more than price of last year More than 40 years Less than 2015 Yes 18 % more than price of last year No 13 % more than price of last year Later than 2015 Yes 12 % more than price of last year No 5 % more than price of last year Program should take the year of birth of the person, model year of the car, history of accident and the price for the last year from the user.
In: Computer Science
Based on the following scenario, which project do you support if you make a decision based on the IRR alone?
Project A requires an initial investment (or you may say, ‘cash outflow’) of $525,000 and is expected to generate the following net cash inflows:
Year 1: $120,000
Year 2: $110,000
Year 3: $120,000
Year 4: $110,000
Year 5: $120,000
Year 6 : $130,000
The expected rate of return is 5%.
Project B also requires an initial investment (or you may say, ‘cash outflow’) of $525,000 and is expected to generate the following net cash inflows:
Year 1: $300,000
Year 2: $200,000
Year 3: $90,000
Year 4: $0
Year 5: $0
Year 6 : $0
The expected rate of return is 5%.
Project A
OR
Project B
CORRECT ANSWER=PROJECT A
I just need to know the real reason why please.
In: Economics
The registrar of a law school has compiled the following statistics on the progress of the school's students working toward the LLB degree: Of the first-year students in a particular year, 80% successfully complete their course of studies and move on to the second year, whereas 20% drop out of the program; of the second-year students in a particular year, 92% go on to the third year, whereas 8% drop out of the program; of the third-year students in a particular year, 98% go on to graduate at the end of the year, whereas 2% drop out of the program.
(a) Construct the transition matrix associated with the Markov process. (Label your matrix using this order: Drop out, Graduate, First-Year, Second-Year, Third-Year)
(b) Find the steady-state matrix. (Round your answers to four decimal places.)
(c) Determine the probability that a beginning law student enrolled in the program will go on to graduate. (Round your answer to four decimal places.)
In: Statistics and Probability
On January 1 of year 1, Arthur and Aretha Franklin purchased a home for $2.83 million by paying 330,000 down and borrowing the remaining $2.50 million with a 8.8 percent loan secured by the home. The Franklins paid interest only on the loan for year 1 and year 2 (unless stated otherwise).
a. What is the amount of interest expense the Franklins may deduct in year 2 assuming year 1 is 2017?
b. What is the amount of interest expense the Franklins may deduct in year 2 assuming year 1 is 2018?
c. Assume that year 1 is 2018 and that in year 2, the Franklins pay off the entire loan but at the beginning of year 3, they borrow $420,000 secured by the home at a 9 percent rate. They make interest-only payments on the loan during the year. What amount of interest expense may the Franklins deduct in year 3 on this loan? (Assume the Franklins do not use the loan proceeds to improve the home.)
In: Accounting
Mr. D works full-time as a systems analyst for a consulting firm. In addition, he sells plants that he raises himself in a greenhouse attached to his residence. During the past 5 years, the results from raising and selling the plants have been as follows: Year Net Profit (Loss) from Scenario 1:
|
Scenario 1 |
|
|
Year 1 |
(2,000) |
|
Year 2 |
(1,200) |
|
Year 3 |
1,000 |
|
Year 4 |
2,500 |
|
Total Years 1-4 |
300 |
|
Year 5 |
(500) |
2. Please create a scenario (Scenario 2) where the cumulative profits in years 1-4 are still $300 but the taxpayer would be in a better position regarding year 5 losses.
|
Scenario 1 |
Scenario 2 |
|
|
Year 1 |
(2,000) |
|
|
Year 2 |
(1,200) |
|
|
Year 3 |
1,000 |
|
|
Year 4 |
2,500 |
|
|
Total Years 1-4 |
300 |
300 |
|
Year 5 |
(500) |
(500) |
In: Accounting
Consdier an adjustable rate mortagage (ARM) loan for 650,000. The interest rate is indexed to the 10-year Treasury yield. The loan has a margin 2.75%, first-year teaser rate of 2.75%, an annual rate cap of 2% and a lifetime rate cap of 5%. The loan requires monthly payments for 25 years. Assume that 10-year Treasury yields are as shown blow.
10-yr treasury yield at first anniversary date (end of year 1) 3.5%
10-yr treasury yield at the end of second year 4.25%
a) What is the debt service payment amount during the first year of the loan, and the loan balance at the end of this first year?
b) What is the contract rate on the loan for the second year?
c) What is the debt service payment during the second year and the loan balance at the end of the year?
d) What are the contract rate, monthly payment and end-of-year loan balance for year 3?
In: Finance