The rate of return earned on an investment of $50,000 today that guarantees an annuity of $10,489 for six years in approximately:
A) 5 percent
B) 7 percent
C) 30 percent
D) 10 percent
E) 12 percent
B
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Stock in Merlin Corporation is held equally by Jane, Eve, and Fred. Merlin seeks additional capital to buy a valuable tract of land that will cost $6,000,000. Jane, Eve, and Fred propose to loan Merlin $2,000,000 each, taking from Merlin a $2,000,000 10-year note with interest payable annually at five points above the prime rate. Merlin Corporation has current taxable income of $7,000,000. How are the payments on the notes treated for tax purposes?
What will be an ideal response?
Which one of the following is a more serious concern in terms of an adverse variance from budget?
A. a negative variance of $10,000 in budget expenditures B. a $10,000 shortfall in value earned on the project to date C. a positive variance of $10,000 in budget expenditures D. a $10,000 surplus in value earned on the project to date
On a CVP graph, the total variable cost line intersects the y-axis at zero
Indicate whether the statement is true or false
Which of the following is an essential element of internal control?
A) Computerized accounting systems B) An outsourced internal audit function C) Procedures for proper authorization of transactions D) Verification by government agencies