Find present value of an investment in plant and equipment

Assignment Help Financial Accounting

Reference no: EM131221697

Find the present value of an investment in plant and equipment if it is expected to provide annual earnings of $65,000 for 15 years and to have a resale value of $125,000 at the end of that period. Assume a 10% rate and earnings at year end. The present value of 1 at 10% for 15 periods is .23939. The present value of an ordinary annuity at 10% for 15 periods is 7.60608. The future value of 1 at 10% for 15 periods is 4.17725.

a. $619,395

b. $494,395

c. $524,319

d. $1,004,925

Reference no: EM131221697

Questions Cloud

The journal to record the sale will include : Equipment costing $37,450 with a book value of $18,410 is sold for $20,000. The journal to record the sale will include a :

What journal entry is required : The backyard store received a debit memo for $789 from second national bank for a customers check that was returned marked "NFS" Ms Smith instructed you to set up an account for the customer george dunne in the accounts receivable subsidiary ledger a..

Accumulated depreciation-beginning inventory-common stock : Accumulated depreciation, Beginning inventory, Common Stock, Retained earnings, Ending inventory, Operating expenses, Purchases, Sales, Dividends. What is the revenues and what are the expenses from the list above?

Stock was originally recorded using the cost method : 24,800 shares reacquired by Elixir Corporation for $48 per share were exchanged for undeveloped land that has an appraised value of $1,740,700. At the time of the exchange, the common stock was trading at $63 per share on an organized exchange. (a) P..

Find present value of an investment in plant and equipment : Find the present value of an investment in plant and equipment if it is expected to provide annual earnings of $65,000 for 15 years and to have a resale value of $125,000 at the end of that period. Assume a 10% rate and earnings at year end. The pres..

Cost of goods sold is reported : Cost of Goods Sold is reported

Historical or acquisition cost : There are four basic accounting principles that underlie all accounting and financial reporting practices. These principles are (1) historical cost, (2) revenue recognition, (3) matching principle, and (4) full disclosure. According to the historical..

Balance sheet of merchandising firm different from : How is the balance sheet of a merchandising firm different from the balance sheet of a service business?

Cost of goods available for sale for the year : Baxter Company's merchandise inventory at the start of 2014 was $85,000. The company purchased inventory during 2014 in the amount of $323,000, and its inventory at the end of the year was $102,000. What was Baxter's Cost of Goods Available for Sale ..

User Account

All Pages