Present worth of the companys total income

Assignment Help Financial Management
Reference no: EM131020481

A certain company's income has been declining steadily over the last three years. If income in year 1 was $100,000 and it declined by $10,000 per year; which of the following is closest to the present worth of the company's total income over the three years? Assume a compound interest rate of 10% per year.

Reference no: EM131020481

Questions Cloud

Assuming joint venture will be located in nigeria : Store Norske is considering forming a joint venture company with Coal India Limited, jointly owned 50% each. What issues will the new company have to address in doing business assuming the joint venture will be located in the Nigeria? Discuss.
What is the percentage price change of bonds : Bond J is a 7 percent coupon bond. Bond K is a 13 percent coupon bond. Both bonds have 20 years to maturity, make semiannual payments, and have a YTM of 10 percent. If interest rates suddenly rise by 2 percent, what is the percentage price change of ..
Calculate the price elasticity of demand for rye : Calculate the change in the quantity of rye demanded divided by the change in the price of rye, but this time measure the quantity of rye in millions of bushels. Compare your answer to the one you computed in (a).
What are the three biggest risks the firm faces : Explain how the business risks differ between traditional tax and audit services and management consulting services. In your opinion, what are the three biggest risks the firm faces if it diversifies into the new service line?
Present worth of the companys total income : A certain company's income has been declining steadily over the last three years. If income in year 1 was $100,000 and it declined by $10,000 per year; which of the following is closest to the present worth of the company's total income over the thre..
Sources of the data are printed in capital letters : The data required to reconcile the bank statement as of July 31 have been taken from various documents and records and are reproduced as follows. The sources of the data are printed in capital letters. All checks were written for payments on accou..
Carrying value for the new blueprint printer : Compute the annual depreciation and carrying value for the new blueprint printer for each of the four years (round to the nearest dollar where necessary) under each of the following methods: (a) straight-line, (b) production, and (c) double-declin..
What was the gift tax : In 2010, mike gave $13,000 worth of ABC stock to his son, In 2014, the ABC shares are worth $25,000. What was the gift tax in 2010? AND What is the total amount removed from mikes estate in 2014?
Calculate the revenue-maximizing level of output : What is the difference between the output level where the total profit is maximized and the output level where the total revenue (TR) is maximized?

Reviews

Write a Review

Financial Management Questions & Answers

  What volume of demand is necessary for doll to break even

Patricia Zell, a dollmaker is interested in the mass marketing and production of a ceramic doll. The initial investment required for plan and equipment is $25,000. Labor and material costs are $10 per doll. If the dolls can be sold for $50 each, what..

  What is the current price of a bond

What is the current price of a bond if it is priced to yield 2 percent, has a $1,000 face value, has 10 years to maturity, pays semiannual coupon payments, and has a coupon rate of 7 percent?

  What marginal cost of capital will it incur to raise

Tiger inc. needs to raise $85,000 to purchase a new machine. Tiger knows its component costs of capital are debt 5%, preferred stock 7%, new equity 13%, and retained earnings 11%. The firm's marginal tax rate is 30 percent. If Tiger expects to genera..

  The current expected capital gains yield on supers stock

Super carpeting Inc just paid a dead-end (Do) of $3.12, and its dividend is expected to grow ata constant rate (g) of 6.5% per year. If super stock is in equilibrium, the current expected capital gains yield on super's stock will be ____?

  What was last years dividend per share

After a 5-for-1 stock split, Strasburg Company paid a dividend of $1.45 per new share, which represents a 12% increase over last year's pre-split dividend. What was last year's dividend per share?

  Two mutually exclusive extraction projects

An oil drilling company must choose between two mutually exclusive extraction projects, and each costs $11.8 million. Under Plan A, all the oil would be extracted in 1 year, producing a cash flow at t = 1 of $14.16 million. Does this imply that the W..

  Calculate the leverage adjusted duration gap for balthazar

Balthazar's savings bank has assets of 2 million invested in 20 year, 10% coupon Treasury bonds selling at par with duration 7.70 years. Liabilities of 1.8 million are financed with a two year, 8% coupon selling at par. Calculate the leverage adjuste..

  New retirement savings account

Sharon wants to retire in 30 years time, and so decides to start a new retirement savings account. She wants to accumulate 1000000 dollars by the time she retires. Initially, Sharon deposits 5000 dollars into the account. What is the maximum amount t..

  Retire plan problem

Warren Reed just turned 40. He has decided that he would like to retire when he is 65. He thinks that he will need $2,000,000 in special retirement accounts at age 65 to maintain his current lifestyle. For the next 15 years he can afford to put $10,0..

  Rate-based decision statistic measures the excess return

Which rate-based decision statistic measures the excess return–the amount above and beyond the cost of capital for a project, rather than the gross return?

  Months living expenses covered ratio and their debt ratio

Sami, 34, and Ronald, 31, want to buy their first home. Their current combined net income is $65,000 and they have two auto loans totalling $32,000. They have saved approximately $12,00 for the purchase of their home and have total assets worth $55,0..

  What is present value of bonus package at interest

A bonus package pays an employee 900 at the end of the year, 1600 at the end of the second year, 2300 at the end of the third year, and so on, continuing to increase by 700 every year for the first 9 years of employment. What is the present value of ..

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