$20‚790.99 2 Question 5 What is the future value of investing $3‚000 for 3/4 of a year at a continuously compounded rate of 12%? a. $3‚163 b. $3‚263 c. $3‚283 d. $3‚287 Question 6 If the three-year present value annuity factor is 2.673 and two-year present value annuity factor is 1.833‚ what is the present value of $1 received at the end of the 3 years? a. $1.1905 b.
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1. ------------------------------------------------- Change in PF contribution ------------------------------------------------- Dear All Need some clarification on change in Employer & Employee contribution to PF: Employer and employee is currently contributing 12% of basic into PF (basic being higher than Rs. 6500/-); and employee now wants to restrict his/her contribution now to only 12% of Rs. 6500/- basic‚ ie. Rs. 780/- pm. Example -- Current Basic on which PF contributions are made is
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the state School Aid Fund‚ supporting public education (K-12) programs throughout the state. Retailers received annual commissions of $120.3 million‚ while Michigan Lottery players collected prizes worth $920.8 million. Table I presents sales and funding figures accounted for by the Michigan Lottery since its inception in 1972. The numbers are quite impressive. 22 Case 5 Lottery Winnings-Looks Can Be Deceptive! Table 1 Totals: 1972 Start-up through FY 2000* Total Lottery Ticket Sales $25.12 billion
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o People are living longer‚ so money has to last longer o Of worries that social security wont exist by the time will be needed o Of the turn toward self directed retirement plans • Preparations for Investing: to have a stabilized life‚ net worth estimates‚ regular savings‚ no credit card debt‚ and an employee sponsored retirement plan • 4 Steps in Investing: • Setting goals/developing investment attitudes: o *One of the most important factors affecting goals is current income (for students
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Solutions to Textbook Recommended Problems 4-1. You have just taken out a five-year loan from a bank to buy an engagement ring. The ring costs $5000. You plan to put down $1000 and borrow $4000. You will need to make annual payments of $1000 at the end of each year. Show the timeline of the loan from your perspective. How would the timeline differ if you created it from the bank’s perspective? 0 1 2 3 4 5 4000 –1000 –1000 –1000 –1000 –1000 From the bank’s
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Business mathematics is mathematics used by commercial enterprises to record and manage business operations. Commercial organizations use mathematics inaccounting‚ inventory management‚ marketing‚ sales forecasting‚ and financial analysis. Mathematics typically used in commerce includes elementary arithmetic‚elementary algebra‚ statistics and probability. Business management can be made more effective in some cases by use of more advanced mathematics such as calculus‚ matrix algebra and linear programming
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C/(r − g) = 10‚000/(.10-.05) = $200‚000. Est time: 06-10 9. a. PV = 600‚000/(1.055) = `470‚115.7 (assuming the cost of the car does not appreciate over those five years). b. The six-year annuity factor [(1/0.08) – 1/(0.08 x (1+.08)6)] = 4.623. You need to set aside (600‚000 × six-year annuity factor) = 600‚000 × 4.623 = `2‚773‚727.8. c. At the end of six years you would have 1.086 × (3‚000‚000 – 2‚773‚727.8) = `359‚065.55. Est time: 06-10 10. a. FV = 1‚000e.12 x 5 = 1‚000e.6 = `1
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COMPREHENSIVE EXAMINATION A PART 1 (Chapters 1-6) Problem A-I — Multiple Choice. Choose the best answer for each of the following questions and enter the identifying letter in the space provided. 1. How does failure to record accrued revenue distort the financial reports? a. It understates revenue‚ net income‚ and current assets. b. It understates net income‚ stockholders’ equity‚ and current liabilities. c. It overstates revenue‚ stockholders’ equity‚ and current liabilities.
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a choice of a lump-sum of $5‚000 today‚ or an annuity of $1‚250 a year for the next five years. Which option should Mr Knowitall choose if his opportunity cost is 9 percent ? i) $1‚250 PMT 5 N 9% I/Y CPT PMT b) In their meeting with their advisor‚Mr and Mrs Smith concluded that they would need $40‚000 per year during their retirement years in order to live comfortably. They will retire 10 years from now and expect a 20-year retirement period.How much
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FINANCIAL STATEMENTS Accrual-based approach – revenues are recorded at the point of sale and costs when they are incurred‚ not necessarily when a firm receives or pays out cash Cash flow approach – used by financial professionals to focus attention on current and prospective inflows and outflows of cash 1. Balance sheet a. Assets Cash and Cash Equivalents Marketable securities Accounts receivable Inventories Net property‚ plant and equipment Intangible assets b. Liabilities Accounts
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