options. Option A: Lump-Sum/Cash-option payment: Lottery will pay 50% of published value‚ if cash option is selected and federal Cash before taxes = 181‚500‚00 * 0.50 = $90‚750‚000 Option B: Annuity of 26 years. Under annuity option‚ Lottery takes all the money and invests to fund in 26-years annuity and gives payments to winner. Lottery invests 50% of 181‚500‚000 (present cash value of lump-sum amount) and Lottery received rate of interest of 4%‚ using calculator: N=26‚ I/Y = 4‚
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WAYSIDE INN INC CASE STUDY 2. Company Analysis Wayside Inns was formed in 1980 as the successor to United Motels Enterprises‚ a company that operated several franchised motels under licensing agreements from two national chains. Wayside has been experiencing brisk business and is currently operating at near full capacity. To capture more business Wayside is considering a 40-room expansion for the motel. We shall evaluate the company using a SWOT analysis. Threats - Competitors are expected
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BAB25 – Case analysis 2: New York Life and Immediate Annuities Unlike the old days where a retiree could rest assured that they could live out the rest of their life on their pension and social security checks‚ the retirees of today receive their pensions paid out in a lump sum that takes the place of the pension check‚ but encompasses the total amount a retiree has to live on until they pass away. This creates uncertainty in the amount a retiree can spend per month‚ and if the total amount is
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Pensacola Surgery Center Time Value Analysis A Case Study in Healthcare Finance Catherine Grace Bautista 1. Consider the $50‚000 excess cash. Assume that Gary invests the funds in one-year CD. a. What is the CD’s value at maturity (future value) if it pays 10 percent annual interest? FV = PV x (1+i)n FV = 50‚000 x (1+10%)1 FV = 50‚000 x 1.10 FV = $55‚000 at maturity after a year b. What will its future value be if the CD pays 5 percent interest? If it pays 15 percent interest? @ 5% per annum
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Fundamentals Pilot Paper – Knowledge Module Time allowed: 2 hours ALL 50 questions are compulsory and MUST be attempted. Formulae Sheet‚ Present Value and Annuity Tables are on pages 16‚ 17 and 18 Do NOT open this paper until instructed by the supervisor. This question paper must not be removed from the examination hall. Paper F2 Management Accounting Pilot Paper from December 2011 onwards The Association of Chartered Certified Accountants ALL 50 questions are compulsory and MUST be attempted
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Risk & Return Q1: Which rules should be in mind during selection of stocks for portfolio investment? 1. Allocation 2. Sectors Basic Materials Capital Goods Communication Consumer Cyclical Energy Financial Health Care Technology Transportation 3. Stock Selection 4. Monitor Q2: Distinguish between market risk & diversifiable risk. Can market risk be avoided? Market Risk The possibility for an investor to experience losses due to factors that affect the overall performance of the financial
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interest and therefore will be worth more in the future (Brealey‚ Myers‚ & Marcus‚ 2004). This paper will explain how annuities affect time value of money (TVM) problems and investment outcomes. In addition‚ this paper will briefly address the impact of interest rates‚ present value‚ future value‚ opportunity cost and the rule of 72 on the time value of money. Annuities An annuity is an evenly spaced number of payments or money received in the same amount (Cedar Spring Software‚ Inc.‚ 2002). Each
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Medical Exams to Keep Your Disability Benefit Changing Your Retirement to Disability Retirement Termination of FERS Disability Benefit Reinstatement of Disability Benefit if it Stops Disability Retirement Computation Reductions in Disability Annuity Cost of Living Adjustments for FERS Disability Retiree Entitlement to Other Benefits-Effect on FERS Disability Benefit: When to Consider Applying for Disability Retirement You should consider applying for disability retirement only after you
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2 Contents Conceptual framework for financial reporting Objectives 2.1 Why a conceptual framework? 2.2 IASB Framework for the Preparation and Presentation of Financial Statements 2.2.1 The objective of financial statements 2.2.2 Stewardship as an objective of financial statements: the current debate 2.2.3 Underlying assumptions 2.2.4 A note on the ‘going concern’ assumption 2.2.5 Qualitative characteristics of financial reporting information 2.2.6 Constraints on financial reporting 2.3 Elements
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of interest paid or earned over a year’s time? Wrong Answer: the periodic rate Which of the following has the highest time value of money at the same time interest rate for the same number of payments Correct Answer: the future value or an annuity-due Which of the following would increase the present value of a single cash flow? Wrong Answer: a decrease in the cash flow You invest $1000 at 6% compounded annually and want to know how much money you will have in 5 years. What does the
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