On January 1, Boston Company completed the following transactions (use a 7% annual interest rate for...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
On January 1, Boston Company completed the following transactions (use a 7% annual interest rate for all transactions): ( EV of $1. PV of $1. EVA of $1. and PVA of $1) (Use the appropriate factor(s) from the tables provided.) a. Promised to pay a fixed amount of $7,400 at the end of each year for six years and a one-time payment of $117,800 at the end of the 6th year. b. Established a plant remodeling fund of $492,100 to be available at the end of Year 7. A single sum that will grow to $492,100 will be deposited on January 1 of this year. c. Agreed to pay a severance package to a discharged employee. The company will pay $76.400 at the end of the first year, $113,900 at the end of the second year, and $151.400 at the end of the third year d. Purchased a $177,000 machine on January 1 of this year for $35,400 cash. A five-year note is signed for the balance The note will be paid in five equal year-end payments starting on December 31 of this year. Required: 1. In transaction (a), determine the present value of the debt. (Round your answer to nearest whole dollar.) Present value 2-a. In transaction (b), what single sum amount must the company deposit on January 1 of this year? (Round your answer to nearest whole dollar.) Amount to deposit 2-b. What is the total amount of interest revenue that will be earned? (Round your answer to nearest whole dollar.) Interest revenue On January 1, Boston Company completed the following transactions (use a 7% annual interest rate for all transactions): ( EV of $1. PV of $1. EVA of $1. and PVA of $1) (Use the appropriate factor(s) from the tables provided.) a. Promised to pay a fixed amount of $7,400 at the end of each year for six years and a one-time payment of $117,800 at the end of the 6th year. b. Established a plant remodeling fund of $492,100 to be available at the end of Year 7. A single sum that will grow to $492,100 will be deposited on January 1 of this year. c. Agreed to pay a severance package to a discharged employee. The company will pay $76.400 at the end of the first year, $113,900 at the end of the second year, and $151.400 at the end of the third year d. Purchased a $177,000 machine on January 1 of this year for $35,400 cash. A five-year note is signed for the balance The note will be paid in five equal year-end payments starting on December 31 of this year. Required: 1. In transaction (a), determine the present value of the debt. (Round your answer to nearest whole dollar.) Present value 2-a. In transaction (b), what single sum amount must the company deposit on January 1 of this year? (Round your answer to nearest whole dollar.) Amount to deposit 2-b. What is the total amount of interest revenue that will be earned? (Round your answer to nearest whole dollar.) Interest revenue
Expert Answer:
Answer rating: 100% (QA)
You can see the answer from the photo I sent 1 Present Valu... View the full answer
Related Book For
Financial Accounting
ISBN: 978-0078025556
8th edition
Authors: Robert Libby, Patricia Libby, Daniel Short
Posted Date:
Students also viewed these accounting questions
-
On January 1, 2014, Boston Company completed the following transactions (use a 8 percent annual interest rate for all transactions): (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Use the...
-
On January 1, 2014, Shannon Company completed the following transactions (assume a 10 percent annual interest rate): a. Bought a delivery truck and agreed to pay $60,000 at the end of three years. b....
-
On January 1, 2014, Boston Company completed the following transactions (use a 7 percent annual interest rate for all transactions): a. Borrowed $115,000 for seven years. Will pay $6,000 interest at...
-
A steam turbine receives a flow of 3 kg/s water at 1200 kPa, 350 C and velocity of 15 m/s. The steam exits the turbine at 100 kPa, 150 C and very low velocity. Find the specific work and the power...
-
Ioco Ltd. is a public company. You are provided with the following information for the years ended December 31, 2016 and 2017: Required: a. What are the dividend payout ratio and dividend yield in...
-
In a very strong magnetic field, we can consider electrons as constrained to move in 1 dimension along the direction of the magnetic field. Consider a beam of relativistic protons propagating with...
-
Many consumers, particularly those in developing countries, are concerned about the cleanliness of municipal water for human consumption. For this reason, distilled water is widely available at work,...
-
Consider the two tables shown in Figure 6.37: Figure 6.37 Relations SALES_REP and TERRITORY a. If a DBMS enforces an UPDATE RESTRICT option on the referential integrity constraint between SALES_REP...
-
Mary Parker works at Dell's Electronics. She oversees the marketing department at the company. She has been a part of the Dell Electronics family for over twenty years. Many of her colleagues...
-
Complete Form 941 for the 4th quarter for TCLH Industries (which is located at 202 Whitmore Avenue, Durham, NC 27701; Employer Identification #44-4444444). Assume that all necessary deposits were...
-
The front veranda on a house is covered by a roof supported by two beams. Each beam is a 4-38mm x 235mm built-up beam and they meet over a wood column. Does a single 140mm x 140mm column serve the...
-
Beech-Nut was heavily in debt, had only \(15 \%\) of the baby food market, and was operating out of a badly maintained 80-year-old plant in Canajoharie, New York. Creditors and debt were growing....
-
Clarify the distinctions among plagiarism, paraphrasing, and direct citation. Consider the following source and three ways that a student might be tempted to make use of it: Source: "The joker in the...
-
The rsum is a door opener for a job seeker. What's on it can get you in the door or cause the door to be slammed in your face. With that type of pressure, it is not surprising to learn that one 2006...
-
Piper High School is in Piper, Kansas, a town located about 20 miles west of Kansas City, Missouri. Christine Pelton was a high school science teacher there. Ms. Pelton, age 26, had a degree in...
-
Stuyvesant High School is an elite New York City high school that the "best of the best" high school students attend. Stuyvesant is ranked as the best of nine free public schools in New York City...
-
The Second Pillar (Pillar 2) of Basel II is concerned with the supervisory review process. Four key principles of supervisory review are specified. Each of the following is a principle EXCEPT Group...
-
Element compound homogeneous mixture (heterogeneous mixture) 4) A piece of gold has a mass of 49.75 g. What should the volume be if it is pure gold? Gold has a density of 19.3 g/cm (3 points) D=m/v...
-
Supply the missing dollar amounts for the income statement for each of the following independentcases. Case A Case B Case C Net sales revenue Beginning inventory Purchases Goods available for sale...
-
A recent annual report for PepsiCo contained the following information for the period (dollars in millions): Net income ............ $6,462 Depreciation and amortization ..... 2,737 Increase in...
-
Calculate the current ratio for Sals Taco Company at the end of 2011 and 2012, based on the following data: What does the result suggest about the company over time? What can you say about Sals Taco...
-
When you were playing the employees role, how did the managers suggestions make you feel?
-
Which of the three quarters exhibited the most consistent increase in value for this security?
-
What was the mean price of the security on the first of January 2004?
Study smarter with the SolutionInn App