PV and FV computations Case Essay
Order ID |
53563633773 |
Type |
Essay |
Writer Level |
Masters |
Style |
APA |
Sources/References |
4 |
Perfect Number of Pages to Order |
5-10 Pages |
Description/Paper Instructions
PV and FV computations Case Essay
1) PV and FV computations.
- If you deposit $100,000 into a saving account yielding 8%, how big will it grow to in 5 years? Assume quarterly compounding.
- What amount should be deposited in a bank account today to receive $300,000 in 6 years at 12 % interest rate? Assume quarterly compounding.
- If $4,000 is deposited into an investment account yielding 10% every quarter starting on 1/1/2018, what amount will be available in the investment account in 4 years.
- What is the present value of 5 $10,000 payments each of which will be received at the beginning of each period, discounted at 6% per a compounding period.
- Hawk, Inc. issued 20,000 shares of bond on 1/1/2018. Those are $1,000/ share par value, 6 year, 6% stated interest rate bonds. The prevailing market rate on 1/1/2018 was 8%.
Calculate the price of the bond.
- Hawk, Inc. considers the Pepsi Bottling Company and Coca Cola Bottling Company in
Salisbury for business expansion. Financial analysts specialized in valuation of soft drink companies estimated that Pepsi bottling will earn $400,000 a year over the next 25 years, while Coca-Cola Bottling will earn $600,000 over the next 30 years. Due to different credit rating of the two companies, the prevailing market interest rate of Pepsi is 10% and that of Coca-Cola is 8%. The Pepsi is asking $3,400,000, while The Coca-Cola is asking $6,000,000. Which is the better
offer to Hawk?
- Hawk, Inc purchased a rental property for $1,000,000. This property will be leased for 10
years and the salvage value will be $400,000 after 10 years. How much annual rent should Hawk charge to earn 8% return on the investment?
2)
Company
Adjusted Trail Balance
As of 12/31/2018
Account Debit Credit
Cash $30,000
Accounts receivable 40,000
Allowance for doubtful accounts $ 1,000
Notes receivable 18,000
Inventory,1/1/2018 51,000
Prepaid insurance 6,000
Long-term investment in MS stock 80,000
Buildings 500,000
Accumulated depreciated on buildings 300,000
Furniture and equipment 110,000
Accumulated depreciation of F & E 30,000
Patent 90,000
Accounts payable 20,000
Bonds Payable 100,000
Common stock 360,000
Retained earnings 257,000
Dividends 160,000
Sales 410,000
COGS 243,000
Salary expense 50,000
Rent expense 60,000
Gain on sale of discontinued operation 60,000*
Net loss from operations of
discontinued operation 100,000*
Totals 1,538,000 1,538,000
*net of tax amounts, tax = 30%.
Instructions: using information on the above adjusted trial balance prepare
- Multiple steps Income statement for 2018
- Statement of retained earnings of 2014
- Multiple step Balance sheet as of 12/31/2018
3). Presented below is information related to COYOTE’s operations for 2016.
1) At the beginning of 2016, the company purchased a depreciable asset with a cost of $400,000 and useful life of 4 years. The company uses the straight-line method for accounting purpose and the ACRS system for tax purposes. The depreciation schedules for both accounting and tax purposes follow:
Year D/E for accounting D/E for tax
2016 100,000 160,000
2017 100,000 120,000
2018 100,000 80,000
2019 100,000 40,000
2) During 2016, COMPANY earned nontaxable municipal bond interest revenue of $30,000 and paid non-deductible fines of $35,000.
3) During 2016, the company sold equipment with a cost of $500,000 for $800,000 on the installment basis which allows the customer to pay $200,000 per year for 4 years. The company uses the installment sales method for tax purpose but the accrual method for financial reporting purpose.
4) The company provides two year warranties for its equipment from the date of sales. During 2016 total warranty cost accrued for financial reporting purpose was $30,000 and the amount paid for the satisfaction of warranty liability was $12,000. The remaining $18,000 is expected to be settled by expenditures of $10,000 in 2017 and $8,000 in 2018.
5) Pretax financial income for 2016 amounts to $500,000.
6) The enacted tax rates still in effect are as follows:
2016 30%
2017 40%
2018 & later 50%
Instructions:
1) Compute the taxable income for 2016.
2) Compute the income tax payable for 2016.
3) Compute the balances of deferred tax asset and/or deferred tax liability as of 12/31/2016.
4) Prepare a journal entry to record income taxes for 2016.
4) COMPANY sponsors a defined benefit pension plan. The company’s actuary provides the following information about the plan.
1/1/16 12/31/16
Projected benefit obligation (18,000) (20,000)
Plan asset (fair value) 16,500 18,000
Settlement rate 8%
Expected rate of return on investment 10%
Prepaid/(accrued) pension cost (1,500) ?
OCI- prior service cost 720 ?
OCI- net loss 950 ?
Service cost for the year 2016 5,200
Contributions in 2016 1,000
Benefits paid in 2016 1,200
* The average remaining service life of old employees eligible for prior service cost benefits is 6 years, while that of all employees eligible for pension benefits is 10 years.
Instructions:
- Compute the pension expense for 2016 using the attached pension worksheet.
- Prepare journal entries for pension expense, contribution, and pension asset/liability for 2016.
Pension Worksheet
Items |
Pension
expense |
Assets |
OCI- PSC |
OCI- gains/losses |
Pension asset/liability |
PPBO |
Plan assets |
RUBRIC
QUALITY OF RESPONSE |
NO RESPONSE |
POOR / UNSATISFACTORY |
SATISFACTORY |
GOOD |
EXCELLENT |
Content (worth a maximum of 50% of the total points) |
Zero points: Student failed to submit the final paper. |
20 points out of 50: The essay illustrates poor understanding of the relevant material by failing to address or incorrectly addressing the relevant content; failing to identify or inaccurately explaining/defining key concepts/ideas; ignoring or incorrectly explaining key points/claims and the reasoning behind them; and/or incorrectly or inappropriately using terminology; and elements of the response are lacking. |
30 points out of 50: The essay illustrates a rudimentary understanding of the relevant material by mentioning but not full explaining the relevant content; identifying some of the key concepts/ideas though failing to fully or accurately explain many of them; using terminology, though sometimes inaccurately or inappropriately; and/or incorporating some key claims/points but failing to explain the reasoning behind them or doing so inaccurately. Elements of the required response may also be lacking. |
40 points out of 50: The essay illustrates solid understanding of the relevant material by correctly addressing most of the relevant content; identifying and explaining most of the key concepts/ideas; using correct terminology; explaining the reasoning behind most of the key points/claims; and/or where necessary or useful, substantiating some points with accurate examples. The answer is complete. |
50 points: The essay illustrates exemplary understanding of the relevant material by thoroughly and correctly addressing the relevant content; identifying and explaining all of the key concepts/ideas; using correct terminology explaining the reasoning behind key points/claims and substantiating, as necessary/useful, points with several accurate and illuminating examples. No aspects of the required answer are missing. |
Use of Sources (worth a maximum of 20% of the total points). |
Zero points: Student failed to include citations and/or references. Or the student failed to submit a final paper. |
5 out 20 points: Sources are seldom cited to support statements and/or format of citations are not recognizable as APA 6th Edition format. There are major errors in the formation of the references and citations. And/or there is a major reliance on highly questionable. The Student fails to provide an adequate synthesis of research collected for the paper. |
10 out 20 points: References to scholarly sources are occasionally given; many statements seem unsubstantiated. Frequent errors in APA 6th Edition format, leaving the reader confused about the source of the information. There are significant errors of the formation in the references and citations. And/or there is a significant use of highly questionable sources. |
15 out 20 points: Credible Scholarly sources are used effectively support claims and are, for the most part, clear and fairly represented. APA 6th Edition is used with only a few minor errors. There are minor errors in reference and/or citations. And/or there is some use of questionable sources. |
20 points: Credible scholarly sources are used to give compelling evidence to support claims and are clearly and fairly represented. APA 6th Edition format is used accurately and consistently. The student uses above the maximum required references in the development of the assignment. |
Grammar (worth maximum of 20% of total points) |
Zero points: Student failed to submit the final paper. |
5 points out of 20: The paper does not communicate ideas/points clearly due to inappropriate use of terminology and vague language; thoughts and sentences are disjointed or incomprehensible; organization lacking; and/or numerous grammatical, spelling/punctuation errors |
10 points out 20: The paper is often unclear and difficult to follow due to some inappropriate terminology and/or vague language; ideas may be fragmented, wandering and/or repetitive; poor organization; and/or some grammatical, spelling, punctuation errors |
15 points out of 20: The paper is mostly clear as a result of appropriate use of terminology and minimal vagueness; no tangents and no repetition; fairly good organization; almost perfect grammar, spelling, punctuation, and word usage. |
20 points: The paper is clear, concise, and a pleasure to read as a result of appropriate and precise use of terminology; total coherence of thoughts and presentation and logical organization; and the essay is error free. |
Structure of the Paper (worth 10% of total points) |
Zero points: Student failed to submit the final paper. |
3 points out of 10: Student needs to develop better formatting skills. The paper omits significant structural elements required for and APA 6th edition paper. Formatting of the paper has major flaws. The paper does not conform to APA 6th edition requirements whatsoever. |
5 points out of 10: Appearance of final paper demonstrates the student’s limited ability to format the paper. There are significant errors in formatting and/or the total omission of major components of an APA 6th edition paper. They can include the omission of the cover page, abstract, and page numbers. Additionally the page has major formatting issues with spacing or paragraph formation. Font size might not conform to size requirements. The student also significantly writes too large or too short of and paper |
7 points out of 10: Research paper presents an above-average use of formatting skills. The paper has slight errors within the paper. This can include small errors or omissions with the cover page, abstract, page number, and headers. There could be also slight formatting issues with the document spacing or the font Additionally the paper might slightly exceed or undershoot the specific number of required written pages for the assignment. |
10 points: Student provides a high-caliber, formatted paper. This includes an APA 6th edition cover page, abstract, page number, headers and is double spaced in 12’ Times Roman Font. Additionally, the paper conforms to the specific number of required written pages and neither goes over or under the specified length of the paper. |
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