A company bought an equipment for $56,000. Other expenses including installation amounted to $4,000. The equipment is expected to have a life of 16 years with a salvage value of 10% of the original cost. Determine the book value at the end of 12 years by sinking fund method at 12% interest.

Q: OCF analysis

A: Operating Cashflow Analysis  = Net Income + Depreciation and Amortization- Net Working capital

Q: Describe about the LIFO and FIFO method.

A:

Q: Define value chain.

A: Value Chain: Value Chain is the combination of activities including all the costs to do such…

Q: AIS conceptual design

A: AIS stands for Accounting Information System. The process of keeping the accounts and financial…

Q: Explain put–call parity relationship

A: Put-Call parity is the concept that defines the relationship between price of European call option…

Q: Define Reconciliation method

A: Bank reconciliation: Bank statement is prepared by bank. The company maintains its own records from…

Q: Define NRV method.

A: Definition:   Product costs: The costs incurred to acquire the merchandise, ship the stock, prepare…

Q: Explain what is meant by the term “system”. How do subsystems, systems and systems of systems…

A: Accounting Information system is a set of components used for gathering, making, storing, preparing,…

Q: Define TED spread

A: The term TED spread stands for Treasury Euro Dollar Spread. It can be defined as the credit…

Q: Define value drivers

A: Introduction: Value drivers are related to concept of free cash flow valuation model. This helps the…

Q: Can you explain DCF model?

A: Introduction Discounted cash flows: DCF is abbreviated as discounted cash flows. The concept of…

Q: Define embedded options

A: Embedded options are considered to be very much beneficial for both individuals as investors &…

Q: Describe the features of JIT.

A:

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.