The present value of an ordinary annuity of $2,350 each year for 8 years, assuming an opportunity cost of 11 percent, is: (Round to the nearest whole dollar.)
A) $1,020
B) $27,869
C) $18,800
D) $12,093
D
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If, while taking a physical inventory, the company counts their inventory figures less than the actual amount. How will the error affect their bottom line?
The campus bookstore sells 4,000 sets of graduation regalia each year. Placing an order from their supplier costs $25 regardless of order quantity, so they usually place a large order (a half year's supply) at a time
It costs $5 per year to hold a cap and gown in inventory, primarily insurance costs for the highly flammable material. What is the difference in their holding cost if they order at their optimal order quantity compared to their current policy? What will be an ideal response?
Describe what source documents are and the purpose they serve in a business.
What will be an ideal response?
Annala Corporation is considering a capital budgeting project that would require investing $80,000 in equipment with an expected life of 4 years and zero salvage value. Annual incremental sales would be $250,000 and annual incremental cash operating expenses would be $180,000. The project would also require an immediate investment in working capital of $20,000 which would be released for use elsewhere at the end of the project. The company's income tax rate is 30% and its after-tax discount rate is 13%. The company uses straight-line depreciation. Assume cash flows occur at the end of the year except for the initial investments. The company takes income taxes into account in its capital budgeting.The income tax expense in year 2 is:
A. $6,000 B. $75,000 C. $54,000 D. $15,000