Question: Sharon Walsh has developed and patented a computer chip that allows telecommunications in race cars to become more efficient. She agrees to sell the patent

Sharon Walsh has developed and patented a computer chip that allows telecommunications in race cars to become more efficient. She agrees to sell the patent to Pensca for five annual payments of $50,000 each. The payments are to begin three years from today. Given an annual rate of 6%, what is the present value of the five payments?

A. $176,839

B. $187,450

C. $210,618

D. $218,820

The Answer is B, but I am confused on how they got it.

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!

There are many business applications with linear functions and non-linear functions. Some people think that linear models are particularly of interest due to their simplicity and convenience, but...

(S.O. 7) Sharon Walsh has developed and patented a computer chip that allows telecommunications in race cars to become more efficient. She agrees to sell the patent to Pensca for five annual payments...

Hi guys, I am trying to properly answer an accounting question concerning shares, bonds, and stock. I was given two annual reports, and am asked to make a decision on one of the companies depending...

You are a partner in a prestigious accounting firm, and you just received requests for proposal from two companies; Advanced Micro Devices, and Facebook. The deadline for the proposals is, as is...

Hi there! One more question for you. Similar to my last one. I have to have it done by tonight. Let me know if you cannot do it. Here it is: Scenario 3 May I Propose To... You are a partner in a...

Scenario You and your group work for a multi-national consulting firm. Your team is a group of capital budget consultants and are seeking new engagements. You intend on responding to a Request for...

MGT411 Innovative and Creative Business Thinking University of Phoenix Material Organizational Ecosystem Case Study Wal-Mart Stores, Inc. is a leading company in its industry and a widely recognized...

ILLUSTRATION Amazon's Path to Becoming the CAPSULE 5.1 Low-Cost Provider in E-commerce In 1996, shortly after founding Amazon.com, CEO Jeff Bezos told his employees, "When you are small, some- apt...

Averell Cabinetry Case Overview This case is presented as close as possible to the way you may encounter it in working life. Your role is that of a newly hired HR manager. You will learn about the...

A credit card charges 18 percent annual interest and Jacqueline Zumba has $750 due on the statement date. She is only able to make the minimum payment of $22.50. If the billing cycle is 30 days and...

During the first month of operations, Cloutier Heating and Air Conditioning, Inc., completed the following transactions: Requirements 1. Record each transaction in the journal. Key each transaction...

The basic purpose of any investigation report is to record _____. a. only the most basic details b. media reaction c. the facts d. inferences of bystanders

Problems 1 and 2 used different forecasting methods. Which method appears to provide the more accurate forecasts for the historical data? Explain.

Consider the following time series data: Using the nave method (most recent value) as the forecast for the next week, compute the following measures of forecast accuracy: a. Mean absolute error b....

Perform a horizontal analysis of the MLC balance sheet (Table 4-4). a. Compare assets, liabilities, and owners equity from one year to the next. b. Is the corporation better off in 2013 or in 2012?

For the data in Exercise 2, In Exercise 2 The percentages of people who historically apply for the Silver, Gold, and Platinum cards are 60%, 30%, and 10%, respectively. In a recent sample of...

You were not totally satisfied with the vertical analysis, so you now want to run a horizontal analysis of this company. Complete table 4-6. Perform a horizontal analysis on these accounts. Compare...

select the most important customer characteristics that could help predict loan default probability

The background knowledge of the interpreter

The expert rule: We have more confidence in information presented by someone who is an expert in the field than by someone who is not.

How easy the information is to remember