Questions
Find the present values of these ordinary annuities. Discounting occurs once a year.

Find the present values of these ordinary annuities. Discounting occurs once a year. Do not round intermediate calculations. Round your answers to the nearest cent.

  1. $1,000 per year for 14 years at 4%.

    $  

  2. $500 per year for 7 years at 2%.

    $  

  3. $700 per year for 7 years at 0%.

    $  

  4. Rework previous parts assuming they are annuities due.

    Present value of $1,000 per year for 14 years at 4%: $  

    Present value of $500 per year for 7 years at 2%: $  

    Present value of $700 per year for 7 years at 0%: $  

In: Finance

Suppose that a two-year bond with a principal of $100 provides coupons at the rate of...

Suppose that a two-year bond with a principal of $100 provides coupons at the rate of 6% per annum semiannually. Suppose that the zero-rates are

Maturity (years) Zero Rate (%)
0.5 5.0
1.0 5.8
1.5 6.4
2.0 6.8

What is the bond's yield to maturity expressed with the continuous compounding?

- please use the formulas and explain step by step

In: Finance

Suppose that a two-year bond with a principal of $100 provides coupons at the rate of...

Suppose that a two-year bond with a principal of $100 provides coupons at the rate of 6% per annum semiannually. Suppose that the zero-rates are

Maturity (years) Zero Rate (%)
0.5 5.0
1.0 5.8
1.5 6.4
2.0 6.8

What is the current theoretical price of the bond?

- please use formulas and explain step by step

In: Finance

1.The current price of a stock is $21. In 1 year, the price will be either...

1.The current price of a stock is $21. In 1 year, the price will be either $27 or $15. The annual risk-free rate is 6%. Find the price of a call option on the stock that has a strike price is of $23 and that expires in 1 year. (Hint: Use daily compounding.) Round your answer to the nearest cent. Assume 365-day year. Do not round your intermediate calculations.

2.The current price of a stock is $15. In 6 months, the price will be either $20 or $12. The annual risk-free rate is 3%. Find the price of a call option on the stock that has a strike price of $13 and that expires in 6 months. (Hint: Use daily compounding.) Round your answer to the nearest cent. Assume a 365-day year. Do not round your intermediate calculations.

In: Finance

As an Optional Challenge problem: create a balance sheet at end of year 8 on the...

As an Optional Challenge problem: create a balance sheet at end of year 8 on the accrual basis of accounting. Remember that for each event above, asset entries must equal entries for liabilities and stockholders’ equity (A = L + E).

In: Finance

An investor buys some shares of ABC for $20 at the beginning of the year. During...

An investor buys some shares of ABC for $20 at the beginning of the year. During the year he receives $0.50 in dividends, and then sells the shares for $21 at the end of the year. What is the total return on this investment?

In: Finance

You purchased shares in Home Depot at the beginning of the year for $55 a share....

You purchased shares in Home Depot at the beginning of the year for $55 a share. Home Depot paid a $3 dividend throughout the year, and its share price ended the year at $50. If inflation that year was 3%, what was the real holding-period return for the year?

Multiple Choice

-6.44%

-6.36%

-11.74%

-3.64%

In: Finance

By the end of this year you would be 35 years old and you want to...

By the end of this year you would be 35 years old and you want to plan for your retirement. You wish to retire at the age of 65 and you expect to live 20 years after retirement. Upon retirement you wish to have an annual sum of $50,000 to supplement your social security benefits. Therefore, you opened now your retirement account with 7% annual interest rate. At retirement you liquidate your account and use the funds to buy an investment grade bond which makes $50,000 annual coupon payments based on a 6 % coupon rate, throughout your retirement years.

Please calculate the monthly payment in your retirement account in order to be able to achieve the plan mentioned above?

In: Finance

Following are the transactions and adjustments that occurred during the first year of operations at Kissick...

Following are the transactions and adjustments that occurred during the first year of operations at Kissick Co.

  1. Issued 192,000 shares of $4-par-value common stock for $768,000 in cash.
  2. Borrowed $530,000 from Oglesby National Bank and signed a 11% note due in three years.
  3. Incurred and paid $380,000 in salaries for the year.
  4. Purchased $640,000 of merchandise inventory on account during the year.
  5. Sold inventory costing $590,000 for a total of $920,000, all on credit.
  6. Paid rent of $110,000 on the sales facilities during the first 11 months of the year.
  7. Purchased $180,000 of store equipment, paying $51,000 in cash and agreeing to pay the difference within 90 days.
  8. Paid the entire $129,000 owed for store equipment and $600,000 of the amount due to suppliers for credit purchases previously recorded.
  9. Incurred and paid utilities expense of $34,000 during the year.
  10. Collected $855,000 in cash from customers during the year for credit sales previously recorded.
  11. At year-end, accrued $58,300 of interest on the note due to Oglesby National Bank.
  12. At year-end, accrued $10,000 of past-due December rent on the sales facilities.


Required:
a. Prepare an income statement (ignoring income taxes) for Kissick Co.'s first year of operations and a balance sheet as of the end of the year. (Hint: You may find it helpful to prepare a T-account for the Cash account since it is affected by most of the transactions.)

KISSICK CO.
Income Statement
Sales
Cost of goods sold
Gross profit $0
Salaries expense
Rent expense
Utilities expense
Loss from operations $0
Interest expense
Net loss $0
KISSICK CO.
Balance Sheet
Assets:
Cash
Accounts receivable
Merchandise inventory
Total current assets 0
Equipment
Total assets $0
Liabilities:
Accounts payable
Rent payable
Interest payable
Total current liabilities 0
Total liabilities $0
Stockholders' Equity:
Common stock
Total Stockholders' equity 0
Total liabilities and stockholders' equity $0

In: Accounting

The cost data for Evencoat Paint for the year 2019 is as follows: Month Gallons of...

The cost data for Evencoat Paint for the year 2019 is as follows:

Month Gallons of
Paint
Produced
Equipment
Maintenance
Expenses
January 110,000 $70,700
February 68,000 66,800
March 71,000 67,000
April 77,000 68,100
May 95,000 69,200
June 101,000 70,300
July 125,000 70,400
August 95,000 68,900
September 95,000 69,500
October 89,000 68,600
November 128,000 72,800
December 122,000 71,450

A. Using the high-low method, express the company’s maintenance costs as an equation where x represents the gallons of paint produced. Then estimate the fixed and variable costs.

Fixed cost $ 60,000

Variable cost $

Need help with variable cost.

In: Accounting