Exercise 2 (Basic Present Value Concepts) Each of the following parts is independent. (Ignore income taxes.) 1. Amano Freightlines plans to build a new garage in three years to have more space for repairing its trucks. The garage will cost P400,000. What lump-sum amount should the company invest now to have the P400,000 available at the end of the three-year period? Assume that the company can invest money at: a. Eight percent. b. Twelve percent. 2. Lorna Products, Inc., can purchase a new copier that will save P5,000 per year in copying costs. The copier will last for six years and have no salvage value. What is the maximum purchase price that Lorna Products would be willing to pay for the copier if the company's required rate of return is: a. Ten percent? b. Sixteen percent? 3. Tom has just won the million-peso slot machine jackpot at a gambling casino. The casino will pay her P50,000 per year for 20 years as the payoff. If Tom can invest money at a 10% rate of return, what is the present value of her winnings? Did she really win a million pesos? Explain.

Q: can you also explain what part is a. b. and c. please

A: A budget is an estimate of amount which is prepared by the management for various planning and…

Q: THE SMITH COMPANY Using the business transactions below, complete T-accounts for the Smith Company.…

A: T Accounts    1. Cash Account Particular Debit Particular Credit         To capital A/c…

Q: In which document would you find the MD&A? O A. Form 8-K O B. Form 10-K O C. Both A and B O D.…

A: Paid-in Capital Paid-in capital is that the total quantity cash equivalents contributed to a company…

Q: Concord Corporation's charter authorized issuance of 96,000 shares of $10 par value common stock and…

A: The company issues either common shares or preferred shares. When the company issues these shares…

Q: Can solve question 4 to 7?

A: Salary of the Darnell Johnson = 63500Contribution by his employer toward the retirement plan = 6% of…

Q: is the right answer 7.38

A: Let 100 be the value of Ne Zealand dollar Value of US dollar = 140 Value after inflation in New…

Q: Question 8

A: When net credit sales is divided with average accounts receivable it results in receivable turnover…

Q: What is the after announcment?  This is from question a.

A: Debt Value = $2,700,000Current Debt-to-equity ratio = 30%Increased Debt-to-equity ratio = 50%EBIT =…

Q: Last question help

A:

Q: im.2 answer must be in proper format or i will give down vote

A: When it comes to writing essays or papers, this are the things you have to consider: FORMAT:1.…

Q: is part b answered in this?

A: Ledger posting. : When any transaction is made journal entry is passed, after that those entries are…

Q: What happened to questions 4 and 5?

A: 4.Margin of safety in revenue = Actual sales – Break-even sales= (35,000*5.90) – 88,382= 206,500 –…

Q: ansawer

A: Where a partnership itself is generally not subject to income tax, individual partners (including…

Q: 6, 7, and 8 are not answe

A: 4. What was the cost of goods manufactured for the year -$ 912,1005. What was the cost of goods sold…

Q: WHat ia 2 plus 2

A: Answer:

Q: two questions

A: Prepare an income statement.

Q: (d) On what basis should management select from these two methods to depreciate the machine? Justify…

A: The management should opt for reducing balance method of depreciation for the above scenario: This…

Q: how do you calculate the answers for question a

A: On reading the 4th line of the question, we came across a statement "The company currently absorbs…

Q: Can you answer part 4

A: Stock beta = 1.38 Expected return = 13.6% Risk free rate = 4.7%

Q: Is there a way you can provide an example for number 3?

A: Break-even level is computed by the company at which company has sufficient amount of revenue…

Q: what is 2 plus eight ?

A: The given sentence "2 plus eight" can be symbolically represented as 2+8. Thus, 2+8 is 10.

Q: I, J, K

A: i. Payment of interest would include an outflow of cash and also an increase in interest expense.

Market Efficiency

Market efficiency refers to the market's ability to provide investors with all available information about investment options for buying and selling securities. Market efficiency reflects the true value of securities without undervaluing or overvaluing them. When the quality and quantity of information increase, the market becomes more efficient, allowing it to reduce arbitrage and obtain higher market returns from investment. In a well-functioning market, everyone receives all information completely and immediately at no cost. It opens up a plethora of opportunities for investors to access various investment options.