Otto Co. borrows money on April 30, 2016, by promising to make four payments of $13,000 each
Question:
Otto Co. borrows money on April 30, 2016, by promising to make four payments of $13,000 each on November 1, 2016; May 1, 2017; November 1, 2017; and May 1, 2018.
1. How much money is Otto able to borrow if the interest rate is 8%, compounded semiannually?
2. How much money is Otto able to borrow if the interest rate is 12%, compounded semiannually?
3. How much money is Otto able to borrow if the interest rate is 16%, compounded semiannually?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 75% (8 reviews)
1Present value of the annuity Payment size 13000 Number of payments 4 Interest rate 4 semiannua...View the full answer
Answered By
JAPHETH KOGEI
Hi there. I'm here to assist you to score the highest marks on your assignments and homework. My areas of specialisation are:
Auditing, Financial Accounting, Macroeconomics, Monetary-economics, Business-administration, Advanced-accounting, Corporate Finance, Professional-accounting-ethics, Corporate governance, Financial-risk-analysis, Financial-budgeting, Corporate-social-responsibility, Statistics, Business management, logic, Critical thinking,
So, I look forward to helping you solve your academic problem.
I enjoy teaching and tutoring university and high school students. During my free time, I also read books on motivation, leadership, comedy, emotional intelligence, critical thinking, nature, human nature, innovation, persuasion, performance, negotiations, goals, power, time management, wealth, debates, sales, and finance. Additionally, I am a panellist on an FM radio program on Sunday mornings where we discuss current affairs.
I travel three times a year either to the USA, Europe and around Africa.
As a university student in the USA, I enjoyed interacting with people from different cultures and ethnic groups. Together with friends, we travelled widely in the USA and in Europe (UK, France, Denmark, Germany, Turkey, etc).
So, I look forward to tutoring you. I believe that it will be exciting to meet them.
3.00+
2+ Reviews
10+ Question Solved
Related Book For
Financial Accounting Fundamentals
ISBN: 978-1259726910
6th edition
Authors: John Wild, Ken Shaw, Barbara Chiappetta
Question Posted:
Students also viewed these Business questions
-
On May 2, 2016, HPF Vacations received its April bank statement from First City Bank and Trust. Enclosed with the bank statement, which appears below, was a debit memorandum for $160 that covered an...
-
On April 30, 2016, Aggie Corporation purchased available-for-sale securities. These securities consisted of (a) Smith Corporation 10%, 5-ycar bonds with a face value of $12,000 which were purchased...
-
The following information is available for Bott Company: Additional information for the year: a. b. Last year, depreciation expense was inadvertently' understated in the amount of $ 1,800. The...
-
Using mean-variance portfolio theory, prove that the efficient frontier becomes a straight line in the presence of a risk-free asset. [3] Consider two independent assets, Asset A and Asset B, with...
-
Use summation notation to write the sum. 1. 10 + 30 + 90 + . . . + 7290 2. 15 - 3 + 3 / 5 - . . . - 3 / 625
-
Why is the inner core Earths most dense region? (a) The inner core is made of mostly iron, which is very dense. (b) Dense material sank toward Earths center when Earth was molten. (c) Pressure packs...
-
Verify the vector identity \[\begin{equation*}abla^{2} \boldsymbol{v}=abla(abla \cdot \boldsymbol{v})-abla \times(abla \times \boldsymbol{v}) \tag{15.83}\end{equation*}\]
-
If an agency makes a loan at a below-market rate, what would be the nature of any expense recognized at the time of the loan? If it guaranteed a loan made by others, what would be the nature of any...
-
Evaluate net profit margin, return on equity, and other relevant profitability ratios of the company amazon.com
-
Identify the relation between the following compounds: Br Q P (A)Identical (B) Diastereomers (C) Enantiomers (D)Constitutional isomers
-
Refer to Apples statement of comprehensive income in Appendix A. What is the amount of change in foreign currency translation, net of tax effects, for the year ended September 26, 2015? Is this...
-
On January 1, 2016, a company agrees to pay $20,000 in three years. If the annual interest rate is 10%, determine how much cash the company can borrow with this agreement.
-
Electricians commonly wear rubber shoes and gloves to protect themselves when working with live wiring. Would this suggest that rubber is an efficient or inefficient conductor of electricity? Explain...
-
Explain the acquisition method of accounting for mergers and acquisitions. What effect does expensing merger costs have on the viability of a potential merger or acquisition?
-
Your firm has an average collection period of 34 days. Current practice is to factor all receivables immediately at a 2 per cent discount. What is the effective cost of borrowing in this case? Assume...
-
What is the difference between a public offering and a private placement? What might explain a companys decision to favour one over the other? Your discussion should make reference to the advantages...
-
Why is the binomial model more appropriate for real option analysis than BlackScholes?
-
Most companies use traditional capital budgeting techniques, such as payback period and net present value. Why do you think this is the case? How would you justify the use of real option methodology...
-
In an orbiting space craft, you are handed two identical closed boxes, one filled with sand and the other filled with feathers. Discuss at least a couple of ways that you can tell which is which...
-
Draw the appropriate control flow graph of the given pseudocode.Make sure to only use one number for blocks of code which are all sequential and when the first line is executed, all of those lines...
-
What costs are normally included as part of product costs under the method of variable costing?
-
Refer to Jordyn Companys data in QS 6-1. Compute its production cost per unit under variable costing.
-
Refer to the information about Martol Company in QS 6-5. Would the answer to the question in QS 6-5 change if the company uses variable costing? Explain.
-
Please design a marketing message that embeds the concept of nostalgia and another factor that can potentially moderate the effect of nostalgia to increase consumer desire for post-pandemic travel....
-
Describe the stages a 22-year-old university student would go though when purchasing a new computer. Also, describe the process the same individual would go through when purchasing a frozen pizza.
-
Goal: Evaluate a business opportunity. What to do: Your wealthy aunt owns commercial real estate all over town. When one of her tenants, anonalcoholicbeverage company, goes bankrupt, your aunt...
Study smarter with the SolutionInn App