Annie purchases a television set from a seller who seeks P 12,500 after 60 days (cash in 60 days). Annie requests fast payment, and the merchant offers to calculate the cash price based on the premise that money is worth 8% simple interest. What is the current cash price?

Annie purchases a television set from a seller who seeks P 12,500 after 60 days (cash in 60 days). Annie requests fast payment, and the merchant offers to calculate the cash price based on the premise that money is worth 8% simple interest. What is the current cash price?

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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Question

Annie purchases a television set from a seller who seeks P 12,500 after 60 days (cash in 60 days). Annie
requests fast payment, and the merchant offers to calculate the cash price based on the premise that
money is worth 8% simple interest. What is the current cash price?
Follow the format.
1. Given:
2. Formula:
3. Required:
4. Cash flow Sketch:
5. Solution:

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