A company has just purchased a machine with a cost of s79,994, and signed anote to pay the manufacturer equal semi-annual amounts of $9,378. If thecurrent rate of interest is 6%, how many equal payments will be made?Select one:a. 5O b. 6O C. 8d. 10e. 12

Answered: A company has just purchased a machine…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Valles Galactic Industries is Equipment is financing some equipment purchases. They anticipate a life of 10 years with monthly payments. The arrangement with the vendor worked out is as below. The interest rate is % % per month for the first 48 payments and for the remainder of the loan the interest rate would be 1 % per month. The equipment cost $500,000. What is the monthly payment for the first 48 months?
Give typing answer with explanation and conclusion YG Corporation recently issued 270-day commercial paper with a face value of $2,000,000 and a simple interest rate of 11 percent. The company paid a transaction fee equal to 0.4 percent of the issue, which was taken out of the issue amount before the company received any funds. Assuming there are 360 days in a year, what is the commercial paper's effective annual rate (rEAR)? a. 17.51% b. 11.99% c. 12.56% d. 12.63% e. 12.82%
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Scrimiger Paints wants to upgrade its machinery and on September 20 takes out a loan from the bank in the amount of $550,000. The terms of the loan are 3.7% annual interest rate and payable in 8 months. Interest is due in equal payments each month. A. Compute the interest expense due each month. If required, round final answer to two decimal places. $fill in the blank 923b18021034fe7_1 B. Show the journal entry to recognize the interest payment on October 20, and the entry for payment of the short-term note and final interest payment on May 20. If required, round final answers to two decimal places. If an amount box does not require an entry, leave it blank. Oct. 20 fill in the blank 848f66019ffe028_2 fill in the blank 848f66019ffe028_3 fill in the blank 848f66019ffe028_5 fill in the blank 848f66019ffe028_6 May 20 fill in the blank 848f66019ffe028_8 fill in the blank 848f66019ffe028_9 fill in the blank 848f66019ffe028_11 fill in the blank…
A firm sells the same material with two separate payment plans.1. According to the 1st payment plan, the payment period is 12 months, each monthly payment is 10 837 000 dollars, and an interim payment of 12 million dollars is required at the end of the 6th month.2. In the 2nd payment plan, the payment period is 18 months, each monthly payment is 7 965 000 dollars and an interim payment of 36 million dollars is required at the end of the 12th month. Annual nominal interest rate for both options is 60%. Which payment plan would you recommend? In payments, discrete compound interest is applied.
ST Trucking just signed a $3.8 million contract. The contract calls for a payment of $1.1 million today, $1.3 million one year from today, and $1.4 million two years from today. What is this contract worth today at a discount rate of 8.7 percent? O a. $3,202,223.89 b. $2,108,001.32 c. $3,202,840.91 d. $3,783,648.48 e. $3,480,817.37
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3aWhat is the fair market value of a payment of $519 one month from today and $220 4 months from today with a rate of return of 5%? 3b One payment is made 4 months from today and another payment of the same amount is made 2 months after the first payment. If money can earn 1.5%, what are the equal payments that are made to pay off this loan of $793?
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Your firm is considering the purchase of equipment from two suppliers. Supplier A requires payment of $5500 today for each machine. Supplier B requires a payment of $5600 in 6-months for each machine. If you earn 5% APR compounded monthly, and if both suppliers deliver the exact same machines today and have same warranty, etc... which supplier is offering the better financial terms to your firm? A) Supplier A because $5500 > $5600 B) Supplier A, because the FV of $5500 is $5638.94 which is greater than $5600 C) Supplier B, because the PV of $5600 is $5462, which is less than $5500 D) Supplier B, because the PV of $5600 is $5462, which is less than $5600

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A company has just purchased a machine with a cost of s79,994, and signed a note to pay the manufacturer equal semi-annual amounts of $9,378. If the current rate of interest is 6%, how many equal payments will be made? Select one: a. 5 O b. 6 O C. 8 d. 10 e. 12