Accounting

What is the amount of 10 equal annual deposits that can provide five annual​ withdrawals? Assume that each deposit is made at the end of each year. A first withdrawal of​ $15,000 is made at the end of year 11 and subsequent withdrawals increase at the rate of​ 8% per year over the previous​ year’s withdrawal. Determine the amounts from the following rates. 9% and 6%.

EXPERT ANSWER Interest rate of 9% Step1. Calculate the Investment required to fund the five yearly withdrawals. For this calculate the present value of withdrawals at end of year 10. Year Withdrawals growing at 8% PV 9% Calculation 11 $15,000.0 $13,761.5 15000/1.091 12 $16,200.0 $13,635.2 16200/1.092 13 $17,496.0 $13,510.1 17496/1.093 14 $18,895.7 $13,386.2 18895/1.094 15 …

What is the amount of 10 equal annual deposits that can provide five annual​ withdrawals? Assume that each deposit is made at the end of each year. A first withdrawal of​ $15,000 is made at the end of year 11 and subsequent withdrawals increase at the rate of​ 8% per year over the previous​ year’s withdrawal. Determine the amounts from the following rates. 9% and 6%. Read More »

10) Your machine operator is becoming more productive, and generates additional profit each year. You expect to receive $25,000 in profit at the end of this year, but this will increase 6% a year for the next 15 years. If you have a 13% annual interest rate on your investments (compounded annually), what is the Present Value of the profits over the next 15 years? answer________________ 11) What is the future value of an investment which compounds annually at 8% and starts at $1 ,000/year and grows by 10% per year for 20 years (starting with the second year)? answer______________________ 12) What is the Present Value of a $12,000 inflow 2 years from now, and a $40,000 inflow 6 years from now and a $30,000 outflow 4 years from now. Assume an interest rate of 6% for years 1 and 2, 8% for years 3 and 4 and 10% for years 5 and 6. Assume annual compounding. answer_____________ also show the cash flow diagram. Assume that you have the following cash flows: 0:-$100 1: $0 2: $100 3: $200 4: $300 What is the Annual Equivalent (A) of this series of Cash Flows for time periods (0, 1, 2, 3, 4) i=6%. answer

For these problems, show the cash flow diagram and cash flow notation. EXPERT ANSWER

Question 2: Alice forgets her password. She goes to the system administrator’s office, and the admin resets her password and gives Alice the new password. A. Why does the system administrator reset the password instead of giving Alice her previous (forgotten) password? B. Why should Alice change her password immediately after the system administrator has given her the new one? C. Suppose that after the system administrator resets Alice’s password, she remembers her previous password. Alice likes her old password, so she resets it to its previous value. Would it be possible for the system administrator to determine that Alice has chosen the same password as before? Why or Why not?

EXPERT ANSWER A) System Administrator resets the password instead of giving her previous password because the database is storing that password which can be destroyed by not inputting the incorrect password. Therefore the reset algorithm works B) Because Now she came to know what is the the procedure to reset the password. C) Yes System …

Question 2: Alice forgets her password. She goes to the system administrator’s office, and the admin resets her password and gives Alice the new password. A. Why does the system administrator reset the password instead of giving Alice her previous (forgotten) password? B. Why should Alice change her password immediately after the system administrator has given her the new one? C. Suppose that after the system administrator resets Alice’s password, she remembers her previous password. Alice likes her old password, so she resets it to its previous value. Would it be possible for the system administrator to determine that Alice has chosen the same password as before? Why or Why not? Read More »

2. HHQ1 LLC has projected a net income of $1 million USD in 2020. HHQ1 pays $100,000 total dividends to its 100,000 common shareholders outstanding @ the end of 2019 (Jan 01: 80,000 shares outstanding: July 01: 20,000 new shares were issued). The company also has 10,000 convertible preferred stocks ($5 dividend per P.S) and 2000 convertible bonds (10% coupon rate @$1000 par value). In 2020, 80% of the preferred stock holders may convert to common stocks (3 Common shares per preferred share). Also, 100% bondholders are allowed to convert to 2 common shares per bond. Tax rate 40%. Calculate both the basic and diluted EPS for HHQ1 3. A company has a profit margin of 8.8%, total asset turnover of 3.7, assets of $88,000 and liabilities of $25,000. How would the ROE change if profit margin increases to 9.5%, sales decrease by 5% and all balance sheet items stay the same? 4. Lets play communications paid 50,000 USD worth of cash dividends and retained 220,000 USD from their net income in FY 2018. Their total equity at the end of FY 2017 was 330,000 and the end of FY 18 the total equity balance was including some other gains/surplus 585,000 USD. What is their comprehensive income, if any? 5. We’ll not play LLC had 1,000,000 average shares outstanding during all of 2017. During 2017, WNP also had 20,000 options outstanding with exercise prices of $45 each. The average stock price of WNP during 2016 was $42 and during 2017 increased 19.05% from ’16. For purposes of computing diluted earnings per share, how many shares would be used in the denominator in 2017? What is the basic EPS if reported net income is 1,250,000 in 2017?

EXPERT ANSWER Answer to Question No : 2 Particulars Basic EPS Diluted EPS   Net Income    1,000,000.00    1,000,000.00 Less: Preferred Dividend (10,000 x 5)        (50,000.00) (10,000 x 5)x20%        (10,000.00) Add: After tax cost in Interest (2,000x 1,000x 10%x 60%)        120,000.00 Earning Available for Equity Share Holders (Numerator)        950,000.00    1,110,000.00 …

2. HHQ1 LLC has projected a net income of $1 million USD in 2020. HHQ1 pays $100,000 total dividends to its 100,000 common shareholders outstanding @ the end of 2019 (Jan 01: 80,000 shares outstanding: July 01: 20,000 new shares were issued). The company also has 10,000 convertible preferred stocks ($5 dividend per P.S) and 2000 convertible bonds (10% coupon rate @$1000 par value). In 2020, 80% of the preferred stock holders may convert to common stocks (3 Common shares per preferred share). Also, 100% bondholders are allowed to convert to 2 common shares per bond. Tax rate 40%. Calculate both the basic and diluted EPS for HHQ1 3. A company has a profit margin of 8.8%, total asset turnover of 3.7, assets of $88,000 and liabilities of $25,000. How would the ROE change if profit margin increases to 9.5%, sales decrease by 5% and all balance sheet items stay the same? 4. Lets play communications paid 50,000 USD worth of cash dividends and retained 220,000 USD from their net income in FY 2018. Their total equity at the end of FY 2017 was 330,000 and the end of FY 18 the total equity balance was including some other gains/surplus 585,000 USD. What is their comprehensive income, if any? 5. We’ll not play LLC had 1,000,000 average shares outstanding during all of 2017. During 2017, WNP also had 20,000 options outstanding with exercise prices of $45 each. The average stock price of WNP during 2016 was $42 and during 2017 increased 19.05% from ’16. For purposes of computing diluted earnings per share, how many shares would be used in the denominator in 2017? What is the basic EPS if reported net income is 1,250,000 in 2017? Read More »

The balance sheet of the Alba, Blick, and Calvo partnership on January 1, 2006 (the date of partnership dissolution) was as follows:CashP2,000LiabilitiesP4,010Other assets13,000Loan from Alba500Loan to Calvo1,000Alba, capital (20%)990Blick, capital(40%)4,500Calvo, capital(40%)6,000Total assetsP16,000Total liab./equityP16,000In January, other assets with a book value of P8,000 were sold forP5,000 in cash. Required: Determine how the available cash on January 31, 2006 will Redistributed

EXPERT ANSWER For information purpose: Cash P2,000    Liabilities P4,010 Other assets 13,000 Loan from Alba 500 Loan to Calvo 1,000 Alba, capital (20%) 990 Blick, capital(40%) 4,500 Calvo, capital(40%) 6,000 Total assetsP16,000 Total liab./equity P16,000 Since the assets of book value P8,000 have been sold and cash of P5000 is recovered, therefore total cash …

The balance sheet of the Alba, Blick, and Calvo partnership on January 1, 2006 (the date of partnership dissolution) was as follows:CashP2,000LiabilitiesP4,010Other assets13,000Loan from Alba500Loan to Calvo1,000Alba, capital (20%)990Blick, capital(40%)4,500Calvo, capital(40%)6,000Total assetsP16,000Total liab./equityP16,000In January, other assets with a book value of P8,000 were sold forP5,000 in cash. Required: Determine how the available cash on January 31, 2006 will Redistributed Read More »

You are the Financial Controller in a manufacturing business, Sundance & Cassidy Ltd, which like many businesses in the UK is beginning to feel the impact of the credit crunch. The business is a large private company with 270 employees and has a turnover of £50 million. You prepare the quarterly management accounts and provide these to Robert, the Financial Director (FD), for his comments. A few months ago you had noted that the balance sheet position was slightly below that required by the covenant over the company’s long-term bank loan, and you made Robert aware of this. He thanked you for your vigilance and for raising the issue, but told you not to worry.

A few days later, a set of quarterly management accounts were sent to the bank. Robert provided you with a set of accounts for the file. You noted that the stock figure on the balance sheet had been increased by £1,850,000. Without this adjustment, the banking covenant would have been breached that particular quarter. Whilst …

You are the Financial Controller in a manufacturing business, Sundance & Cassidy Ltd, which like many businesses in the UK is beginning to feel the impact of the credit crunch. The business is a large private company with 270 employees and has a turnover of £50 million. You prepare the quarterly management accounts and provide these to Robert, the Financial Director (FD), for his comments. A few months ago you had noted that the balance sheet position was slightly below that required by the covenant over the company’s long-term bank loan, and you made Robert aware of this. He thanked you for your vigilance and for raising the issue, but told you not to worry. Read More »