What is the present value of investment

Assignment Help Accounting Basics
Reference no: EM131015306

Problem 1:

Paltrow Company made an investment in another that guarantees cash flow $ 22,500 each year for the next five years. If the company uses a discount rate of 15% on their investments, what is the present value of this investment?

Problem 2:

The company Argentinian Grill has a 7-year loan $ 23.500 with the local bank. His plan is to start paying the loan in seven equal installments starting today. If the interest rate
It is 8.4%, calculates the annuity payment.

Problem 3:

You currently have 25 and want to retire at the age of 65. As a complement to other sources of retirement, you could deposit $ 3,000 at the end of each year in an IRA. This financial instrument would earn 9.75% over the next 40 years.

a) How much money will accumulate at the end when you turn 65?

Problem 4:

Solve each situation separately, where P = principal; r = interest rate; t = time in years; I = interest and future value FV =

A) P = $ 10.800; r = 6.50%; t = 7 years; I =?

B) I = $ 1.550; t = 11 months r = 7.75%; P =?

C) P = $ 30.500; r = 6.75%; t = 10; VF =

D) FV = $ 320,000; r = 5.40% compounded monthly; t = 30; P =?

b) If you decide to wait 10 years to begin to deposit, how much money will accumulate to reach age 65?

c) Discuss the impact of waiting 10 years on the accumulated amount.

Problem 5:

You want to start a bakery business. For this, you will need a capital of $ 75,000 to start operating. If you have to operate within four years. What sum must now invest 12% quarterly composite, the amount needed to keep and operate your business?

Reference no: EM131015306

Questions Cloud

Compute the share price of firm : Compute the cash flows of the project in the first year and in the years, if g is equal to the break-even sales growth rate - Estimate a valuation range for the share price of Firm B.
Degree of fluctuation against the dollar : Probability Distribution of Financing Costs. Space Corporation, a U.S. corporation, decides to borrow Euro for one year. The interest rate on the borrowed euro is 6 percent. Space has developed the following probability distribution for the euro's..
Explain the pathophysiology of the respiratory alteration : A description of the disorder (Croup) and underlying respiratory alteration associated with the type of cough in your selected scenario. Then, explain the pathophysiology of the respiratory alteration (croup/ acute laryngotracheobronchitis)
Identify the nutritional needs for a developing embryo : Identify health concerns or disease associated with poor nutrition during the gestation period.
What is the present value of investment : Paltrow Company made an investment in another that guarantees cash flow $ 22,500 each year for the next five years. If the company uses a discount rate of 15% on their investments, what is the present value of this investment?
Write the paper is about carbon fiber growth : Write the paper is about "Carbon fiber growth"
Payback npv and mirr : Your Division is considering two investment projects each of which requires an up front expenditure of $25 million. You estimate that the cost of capital is 10% and that the investments will produce the following after tax cash flows (in millions ..
Does claimed performance violate principles of hermodynamics : A patent application describes a device that at steady state receives a heat transfer at the rate 1 kW at a temperature of 167°C and generates electricity. There are no other energy transfers. Does the claimed performance violate any principles of..
We are even on the cusp of a 6th mass extinction event : Ensure that each of the questions or topics listed above are addressed with accurate information. Grammar, spelling and syntax are correct.

Reviews

Write a Review

 

Accounting Basics Questions & Answers

  Leonard basis in the building

Leonard received $150,000 insurance proceeds and deducted a $50,000 casualty loss. What is Leonard's basis in the building before any repairs are made?

  Outline which hrm topic you will be focusing on for report

Introduction - outline which HRM topic you will be focusing on for this report. Outline your arguments that support the statement-you need to use and read academic journal articles to provide justifications to your arguments and to support your cri..

  Chris holmes started a personal financial planning

Chris Holmes started a personal financial planning business when he accepted $36,000 cash as advance payment for managing the financial assets of a large estate.

  Which of the following items 1 through 9 are part of the

which of the following items 1 through 9 are part of the financial reporting but are not included as part of

  From the following information develop an aon project

from the following information develop an aon project network. complete the forward and backward pass compute activity

  Explain the logic behind how mrps gross-to-net calculations

explain the logic behind how mrps gross-to-net calculations are processed. what input files are included in this

  Different ways to convert from accrual to cash accounting

What are some different ways to convert from accrual to cash accounting?

  Company new required rate of return

The risk-free rate and the firm's beta remain unchanged. What is the company's new required rate of return? (Hint: First calculate the beta, then find the required return.)

  Caterpillar inc reported the following accounts and amounts

caterpillar inc. reported the following accounts and amounts in millions in its december 31 2008 year-end financial

  The interest is paid annually

What will the price of this bond be if the interest is paid annually?

  Legal regulations of conducting business overseas

Over the past several weeks, you have been learning the various issues the ethical and legal challenges and factors involving your organization.

  Assume that these services must make a combined profit of

the audiology department at randall clinic offer many services in the clinics patients. the three most common along

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd