SoPretty is a kid’s jeans manufacturer and the management are considering expanding their factory next year to add an adult line. In order to facilitate the expansion, the management identified two types of equipment at different price points. The firm requires a minimum rate of return on their investment of 8%. In addition, it should not take longer than 3.5 years for the firm to recover its initial investment. The cashflows of both types of equipment (project A and project B) are given below. If both projects are mutually exclusive, which one would you recommend to the management based on the IRR, the payback period and the discounted payback ratio

Meagan invests $1,200 each year in an IRA for 12 years in an account that earned 5% compounded annually. At the end of 12 years, she stopped making payments to the account, but continued to invest her accumulated amount at 5% compounded annualy for the next 11 years.

a.) What was the value of the IRA at the end of 12 years?

b.) What was the value of the investment at the end of the next 11 years?

An investor invests $11000. The investment pays $4000 at the end of year 1, $5000 at the end of year 2 and $4500 at the end of year 3. (a) Calculate the internal rate of return (IRR) of the investment. (b) Calculate the net present value (NPV) of the investment using interest preference rate of 8.5%.

Show all works, and please calculate it with math formula instead of financial calculator!! Thank you!

4. C and D are equal partners in the CD partnership. C starts the year with an adjusted basis of $400 in the partnership while D starts the year with an adjusted basis of $700.

(a) The partnership distributes cash of$ 500 to C and land, adjusted basis $300 fair market value $500 to D. The partnership thereafter continues operations. What consequences?

(b) Same as (a) except that the land had an adjusted basis of $800 (fair market value still $500). (c) Same as (a) except that the land had a fair market value of $600 and subject to liabilities of $100.

(d) Same as (c) (land has adjusted basis $300, fair market value $600, subject to a liability of $100) except that the distributions were in liquidation of the partnership.

Govermental Accounting

Compute The Expense and Expenditure for the Grambling Housing Development for the year ended December 31, 2016 based on the following data:

Grambling Housing Development, a small housing service nonprofit agency, began operations on January 1, 2016, with $40,000 cash and $150,000 Equipment, on which $60,000 was owed on a note to Chase Bank. The equipment was expected to have a remaining useful life of 25 years with no salvage value. During its first year of operations, ending December 31, 2016, Grambling Housing paid or accrued the following:2.Utilities, $24,0004.Capital Outlay-additional houses were purchased on January 3, 2016 for $300,000 expected to have a 25 year useful life.

Salaries and other personnel costs, $100,000

Utilities $24,000

Debt service-interest $5,500 and payment on long-term note principal $10,000

Capital Outlay-additional houses were purchased on January 3, 2016 for $300,000 expected to have a 25 year useful life.

5. C and D are equal partners in the CD partnership. C starts the year with an adjusted basis of $300 in his partnership interest while D starts the year with an adjusted basis of $600. The partnership distributes cash of $200 and inventory, adjusted basis $450 fair market value $500, to C and cash of $200 and land, adjusted basis $300, fair market value $700, subject to a liability of $200, to D. The partnership continues operation thereafter. What consequences to the parties?

Personal Budget

At the beginning of the school year, Priscilla Wescott decided to prepare a cash budget for the months of September, October, November, and December. The budget must plan for enough cash on December 31 to pay the spring semester tuition, which is the same as the fall tuition. The following information relates to the budget:

a. Prepare a cash budget for September, October, November, and December. Enter all amounts as positive values except cash decrease which should be indicated with a minus sign.

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b. Are the four monthly budgets that are presented prepared as static budgets or flexible budgets?

Static

c. What are the budget implications for Priscilla Wescott?

Priscilla can see that her present plan will not provide  sufficient cash. If Priscilla did not budget but went ahead with the original plan, she would be $ short  at the end of December, with no time left to adjust.

A. Suppose that, for a particular type of cancer, chemotherapy provides a 5-year survival rate of 72%.

Among 20 patients diagnosed to have this form of cancer who are just starting the chemotherapy,

find the probability that at least 15 of them survive at 5-years or longer. Round answer to 3 significant

digits.

B. A home insurance company charges $2500 for the insurance policy. The policy only covers two

kinds of claims -- minor and large. Eight percent of homeowners will file a minor claim. When this

happens the insurance company pays out $10,000. Only 1% of the population will make a large

claim. When that happens the insurance company has to pay out $150,000. What is the expected

value of this policy to the insurance company?

C. The heights of National Basketball Association (NBA) players are normally distributed with a mean of

79” (6’7”) and a standard deviation of 3.89 inches. What heights delineate the middle 80% of NBA

players? Round your answer to the nearest inch.

In the coming year, Urayse, Inc. will be introducing its first product, a wrist brace that protects serious video gamers from repetitive-motion injuries. The brace will be sold for $11.25 to retailers throughout the country. All sales will be made on account. An expected 65% of sales will be collected within the quarter of the sale, and another 30 % in the quarter following the sale. The remaining 5% of credit sales are expected to be uncollectible. The sales budget for the coming year is as follows

Prepare Urayse, Inc.'s, cash receipts budget for the coming year.   

The Landry Corporation needs to raise $1.30 million of debt on a 15-year issue. If it places the bonds privately, the interest rate will be 11 percent, and $35,000 in out-of-pocket costs will be incurred. For a public issue, the interest rate will be 10 percent, and the underwriting spread will be 4 percent. There will be $150,000 in out-of-pocket costs. Assume interest on the debt is paid semiannually, and the debt will be outstanding for the full 15 years, at which time it will be repaid. (Use a Financial calculator to arrive at the answers.) The Landry Corporation needs to raise $1.30 million of debt on a 15-year issue. If it places the bonds privately, the interest rate will be 11 percent, and $35,000 in out-of-pocket costs will be incurred. For a public issue, the interest rate will be 10 percent, and the underwriting spread will be 4 percent. There will be $150,000 in out-of-pocket costs. Assume interest on the debt is paid semiannually, and the debt will be outstanding for the full 15 years, at which time it will be repaid. (Use a Financial calculator to arrive at the answers.) a. For each plan, compare the net amount of funds initially available—inflow—to the present value of future payments of interest and principal to determine net present value. Assume the stated discount rate is 12 percent annually, but use 6.00 percent semiannually throughout the analysis. (Disregard taxes.) (Negative answers should be indicated by a minus sign. Do not round intermediate calculations. Enter the answers in dollars not in millions. Omit $ sign in your response. Round the final answer to the nearest whole dollar.).