Answer:
Dickinson Company
a) Effect of each plan on earnings per share:
Current Plan Plan D Plan E
Earnings per share $0.45 $0.36 $0.45
b-1) Earnings per share $0 $0 $0.14
b-2. Plan E would be most favorable if return on assets fell to 4.70%.
b-3 Earnings per share $0.93 $0.70 $0.76
b-4 Current Plan would be most favorable if return on assets increased to 14.4%.
c-1 Earnings per share $0.45 $0.36 $0.45
c-2 If the market price for common stock rose to $12 before the restructuring, Plan E would then be most attractive to the company as it would get additional paid-in capital of $1,485,000 ($4 * 371,250).
Explanation:
a) Data and Calculations:
Return on assets before interest and taxes = 9.4%
Tax rate = 40%
Current Plan Plan D Plan E
Assets $11,880,000 $11,880,000 $11,800,000
Long-term debt 5,940,000 5,940,000 2,970,000
New debt 2,970,000
Total debt 8,910,000
Common stock 5,940,000 5,940,000 8,910,000
Less repurchased shares (2,970,000)
New common stock 2,970,000
Interest rate of old debt 9.4% 9.4% 9.4%
Interest rate for new debt 11.4%
Stock par value $8 $8 $8
Return on assets before
interest and taxes $1,116,720 $1,116,720 $1,116,720
Interest expense 558,360 896,940 298,180
Return before taxes $558,360 $219,780 $837,540
Tax rate = 40% 223,344 87,912 335,016
Return after taxes $335,016 $131,868 $502,524
Shares outstanding 742,500 371,250 1,113,750
Earnings per share $0.45 $0.36 $0.45
Return on assets falling to 4.70%
Return on assets before
interest and taxes $558,360 $558,360 $558,360
Interest expense 558,360 896,940 298,180
Return before taxes $0 -$338,580 $260,180
Tax rate = 40% 0 0 104,072
Return after taxes $0 $0 $156,108
Shares outstanding 742,500 371,250 1,113,750
Earnings per share $0 $0 $0.14
Return on assets increasing to 14.4%:
Return on assets before
interest and taxes $1,710,720 $1,710,720 $1,710,720
Interest expense 558,360 896,940 298,180
Return before taxes $1,152,360 $431,380 $1,412,540
Tax rate = 40% 460,944 172,552 565,016
Return after taxes $691,416 $258,828 $847,524
Shares outstanding 742,500 371,250 1,113,750
Earnings per share $0.93 $0.70 $0.76
Market price for common stock rose to $12 before restructuring:
Return on assets before
interest and taxes $1,116,720 $1,116,720 $1,116,720
Interest expense 558,360 896,940 298,180
Return before taxes $558,360 $219,780 $837,540
Tax rate = 40% 223,344 87,912 335,016
Return after taxes $335,016 $131,868 $502,524
Shares outstanding 742,500 371,250 1,113,750
Earnings per share $0.45 $0.36 $0.45
Watermelon, Inc. provides the following data: 20X9 20X8 Cash $41,000 $25,000 Accounts Receivable, Net 102,000 62,000 Merchandise Inventory 72,000 50,000 Property, Plant, and Equipment, Net 181,000 120,000 Total Assets $396,000 $257,000 Additional information for the year ending December 31, 20X9: Net Credit Sales $550,000 Cost of Goods Sold 150,000 Interest Expense 25,000 Net Income 181,000 Calculate the rate of return on total assets for 20X9.
Answer:
the rate of return on total assets is 63.09%
Explanation:
The calculation of the rate of return on total assets is shown below:
Return on total Asset is
= {(Net Income + Interest Expense) ÷ Average Total assets} × 100
= {($181,000 + $25,000) ÷ ($396,000 + $257,000) ÷ 2} × 100
= $206,000 ÷ $326,500 × 100
= 63.09%
Hence, the rate of return on total assets is 63.09%
Paige Company estimates that unit sales will be 10,700 in quarter 1, 12,400 in quarter 2, 14,600 in quarter 3, and 18,700 in quarter 4. Using a sales price of $83 per unit. Prepare the sales budget by quarters for the year ending December 31, 2017.
Answer:
From the attached excel file, we have:
Quarter 1 Sales Value = $888,100
Quarter 2 Sales Value = $1,029,200
Quarter 3 Sales Value = $1,211,800
Quarter 4 Sales Value = $1,552,100
Year = $4,681,200
Explanation:
Note: See the attached excel file for the the sales budget by quarters for the year ending December 31, 2017.
From the attached excel file, we have:
Quarter 1 Sales Value = $888,100
Quarter 2 Sales Value = $1,029,200
Quarter 3 Sales Value = $1,211,800
Quarter 4 Sales Value = $1,552,100
Year = $4,681,200
You plan to save $6,500 per year for the next 8 years. After the last deposit, you will keep the money in the account for 6 more years. The account will earn an interest rate of 6.8 percent. How much will there be in the account 14 years from today
Answer:
$98,254.57
Explanation:
Value after 8 years
Future Value of Annuity = P * ((1 + r)^n - 1 ) / r
Future Value of Annuity = 6500 * ((1 + 6.8%)^8 - 1) / (6.8%)
Future Value of Annuity = 6500 * [(1.69266113113-1) / 0.068]
Future Value of Annuity = 6500 * 10.18619
Future Value of Annuity = $66,210.24
Value after 14 years
FV = PV * (1 + r )^n
FV = 66210.26*(1+ 6.8%)^6
FV = 66210.26 * 1.483978
FV = $98,254.57
So, the amount that will be there in the account 14 years from today is $98,254.57.
The WRT Corporation makes collections on sales according to the following schedule:
25% in month of sale
65% in month following sale
5% in second month following sale
5% uncollectible
The following sales have been budgeted:
Sales
April $120,000
May $100,000
June $110,000
Budgeted cash collections in June would be:_____.
a. $27,500.
b. $98,500.
c. $71,000.
d. $115,500.
Answer:
Total cash collection June= $98,500
Explanation:
Giving the following information:
25% in month of sale
65% in month following sale
5% in second month following sale
5% uncollectible
The following sales have been budgeted:
Sales
April $120,000
May $100,000
June $110,000
Cash collection June:
Cash collection from June= 110,000*0.25= 27,500
Cash collection from May= 100,000*0.65= 65,000
Cash collection from April= 120,000*0.05= 6,000
Total cash collection June= $98,500
Internet là một thị trường hiệu quả hay không hiệu quả về giá?
Answer:
net là một thị trường hiệu quả hay không hiệu quả
Explanation:
The closer the smoothing constant, ALPHA, is to 0 the greater the reaction to the most recent demand the greater the dampening, or smoothing, effect the more accurate the forecast will be the less accurate the forecast will be
Answer: the greater the dampening, or smoothing effect
Explanation:
The smoothing constant determines the level at which a forecast is influenced by previous observations. It simply determine the sensitivity of forecasts with regards to the changes in demand.
It should be noted that large values of α will lead to a scenario whereby forecasts will be more responsive to the more recent levels. On the other hand, the smaller values will result in a damping effect. Therefore, the closer the smoothing constant to α, the greater the dampening, or smoothing effect.
For a company with significant uncollectible receivables, the direct write-off method is unsuitable because ________. it overstates liabilities on the balance sheet it violates the matching principle it uses estimates for determining the bad debt expenses it is not allowed for tax reasons
Answer:
. it violates the matching principle
Explanation:
The direct write-off method can be regarded as accounting method whereby uncollectible accounts receivable are been written off as a bad debt.This method can be regarded as one involving the charging of bad debts to expense in a case whereby
individual invoices is been identified in that instance as uncollectible.
Matching principle imcan be regarded as accounting principle which states that expenses that is been incurred during a period needed to be recorded at this same particular period that related revenues are been earned. It is principle that stressed that expenses must be invited by businesses to earn revenues.
It should be noted that For a company with significant uncollectible receivables, the direct write-off method is unsuitable because it violates the matching principle .
The government sector balance is equal to net taxes ________ government expenditure on goods and services. If that number is ________, a government sector surplus is lent to other sectors; if that number is ________, borrowing from other sectors must finance a government deficit.
Answer:
less
positive
negative
Explanation:
The government sector balance is income from taxes less government spending
Government sector deficit occurs when government spending exceeds income of the government.
When deficit increases, debt increases. This is because a deficit would need to be funded by additional borrowing
When there is a surplus, government spending is less than the income of the government. Government is able to lend to other sectors
M Corporation has provided the following data concerning an investment project that it is considering:
Initial investment $230,000
Annual cash flow $132,000 per year
Expected life of the project 4 years
The net present value of the project is closest to:____.
a. $250,000.
b. $144,128.
c. $(131,000).
d. $(144,128).
Answer: $170,923.60
Explanation:
Missing information is that the discount rate is 12%.
As the cash inflow is constant, this can be termed an annuity. You just need to find the present value of an annuity for 4 years being discounted at 12%.
Present value of Annuity = Annuity * Present value interest factor of Annuity, 12%, 4 periods
= 132,000 * 3.0373
= $400,923.60
Net Present value = Present value of cash inflow - Initial investment
= 400,923.60 - 230,000
= $170,923.60
Options are for variant of question.
Ayayai Corporation reported net cash provided by operating activities of $345,000, net cash used by investing activities of $145,000, and net cash provided by financing activities of $75,000. In addition, cash spent for capital assets during the period was $200,000. No dividends were paid. Calculate free cash flow.
Answer:
the free cash flow is $145,000
Explanation:
The computation of the free cash flow is given below:
The free cash flow is
= cash flow from operating activities - capital expenditures
= $345,000 - $200,000
= $145,000
hence, the free cash flow is $145,000
The same should be considered and relevant
Gross Private Domestic Investment $1,593
Personal Taxes 1,113
Transfer Payments 1,683
Taxes on Production and Imports 695
Corporate Income Taxes 218
Personal Consumption Expenditures 7,304
Consumption of Fixed Capital 1,393
US Exports 1,059
Dividends 434
Government Purchases 1,973
Net Foreign Factor Income 10
Undistributed Corporate Profits 141
Social Security Contributions 748
US Imports 1,483
Statistical Discrepancy 50
Refer to the accompanying national income data (in billions of dollars). Corporate profits are equal to
Multiple Choice
$793.
$702.
$575.
$444.
Answer: $793 billion
Explanation:
Following the information provided in the question, the corporate profit will be calculated as:
Undistributed corporate profits = 141
Add: Dividend = 434
Add: Corporate income taxes = 218
Corporate profit = $793
Therefore, the corporate profit is $793 billion
MC Qu. 133 Cahuilla Corporation predicts... Cahuilla Corporation predicts the following sales in units for the coming four months: April May June July Sales in Units380 420 440 380 Each month's ending Finished Goods Inventory should be 40% of the next month's sales. March 31 Finished Goods inventory is 152 units. A finished unit requires 5 pounds of direct material B at a cost of $2.00 per pound. The March 31 Raw Materials Inventory has 230 pounds of B. Each month's ending Raw Materials Inventory should be 30% of the following month's production needs. The budgeted purchases of pounds of direct material B during May should be:
Answer:
$4,280
Explanation:
Calculation to determine what The budgeted purchases of pounds of direct material B during May should be:
For the month of APRIL
Units required to be produced in April = Units required to be sold April - Opening Inventory 40% of Sales of May
Units required to be produced in April= 380 - 152 + (420 * 40%)
Units required to be produced in April=380-152+168
Units required to be produced in April= 336 units
Total units of raw material to be purchased =336 *5 pounds
Total units of raw material to be purchased= 1,680 pounds
Now for the month of MAY
First step is to calculate May Units required to be produced in May using this formula
Using this formula
Units required to be produced in May = Sales for the month - Opening Inventory + % of Sales of June
Let plug in the formula
Units required to be produced in May= 420 -(420 * 40%) + (440 * 40%)
Units required to be produced in May= 420 -168+176
Units required to be produced in May= 428
Second step is to calculate the Total units of raw material to be purchased
Total units of raw material to be purchased = 428*5 pounds
Total units of raw material to be purchased = 2,140 pounds
Now let determine the budgeted purchases of pounds of direct material B
Purchase cost for the month = $2,140 * $2.00 per pound.
Purchase cost for the month= $4,280
Therefore The budgeted purchases of pounds of direct material B during May should be:$4,280
of 20 >
Which of the statements concerning retirement accounts is true?
A.)Since Roth IRAs are funded with post-tax dollars, they are never as attractive as pre-tax traditional IRAs.
B.)Contributions to personal retirement accounts remain the property of the individual or heirs, but Social Security
payments are transferred to others.
C.)Individuals can allocate the funds in IRAs, 401(k)s, Roth IRAs, and Social Security accounts according to their risk preferences.
D.)Individuals do not pay income tax on Social Security contributions, but there are no tax benefits tied to personal
retirement accounts.
B. Contributions to personal retirement accounts remain the property of the individual of heirs, but SS payments are transferred to others.
Contributions to personal retirement accounts remain the property of the individual or heirs, but Social Security payments are transferred to others. Thus, option B is correct.
What is retirement?Retirement can be termed as when a person leaves an active work life and takes the decision of not returning to work. people usually tend to take retirement at the age of 50 to 60. they may take full, partial, or temporary retirement.
Retirement accounts are basically created by people to have a saving, a tax-free income, and that act as social security.
If you have a retirement account, then the amount that is in the account remains with the account holder itself, but the amount of social security gets transferred to the others. Therefore, option B is the correct option.
Learn more about retirement, here:
https://brainly.com/question/20751552
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At year-end (December 31), Chan Company estimates its bad debts as 0.30% of its annual credit sales of $896,000. Chan records its Bad Debts Expense for that estimate. On the following February 1, Chan decides that the $448 account of P. Park is uncollectible and writes it off as a bad debt. On June 5, Park unexpectedly pays the amount previously written off. Prepare Chan's journal entries for the transactions.
Answer:
Explanation:
Dec 31:
Debit Bad debts expense = 0.003 × $896000 = $2688
Credit Allowance for doubtful accounts = $2688
February 1:
Debit Allowance for doubtful accounts $448
Credit Accounts receivable—P. Park $448
June 5:
Debit Accounts receivable—P. Park $448
Credit Allowance for doubtful accounts $448
June 5:
Debit Cash $448
Credit Accounts receivable—P. Park $448
Southwestern Bank offers to lend you $50,000 at a nominal rate of 6.9%, compounded monthly. The loan (principal plus interest) must be repaid at the end of the year. Woodburn Bank also offers to lend you the $50,000, but it will charge an annual rate of 9.0%, with no interest due until the end of the year. How much higher or lower is the effective annual rate charged by Woodburn versus the rate charged by Southwestern?
a. 1.68%
b. 1.98%
c. 2.08%
d. 1.78%
e. 1.88%
Answer:
e. 1.88%
Explanation:
EAR = (1+APR/m)^m. M means compounding periods
For Southwestern Bank
EAR = (1 + 0.069/12)^12 - 1
EAR = 1.00575^12 - 1
EAR = 1.0712245 - 1
EAR = 0.0712245
EAR = 7.12%
So, the difference between the effective annual rate charged by Woodburn versus the rate charged by Southwestern is 1.88% (9% - 7.12%)
A company must decide between scrapping or reworking units that do not pass inspection. The company has 13,000 defective units that cost $5.50 per unit to manufacture. The units can be sold as is for $3.10 each, or they can be reworked for $4.70 each and then sold for the full price of $8.60 each. If the units are sold as is, the company will be able to build 13,000 replacement units at a cost of $5.50 each, and sell them at the full price of $8.60 each. What is the incremental income from selling the units as scrap and reworking and selling the units
Answer:
Selling as is ⇒ $40,300Reworking and then selling ⇒ $50,700Explanation:
Incremental income from selling the scrap as is:
= 13,000 units * 3.10
= $40,300
Incremental cost from reworking and then selling:
= Sale of reworked units - Cost of reworking units
= (8.60 * 13,000) - (4.70 * 13,000)
= 111,800 - 61,100
= $50,700
Rose dies with passive activity property having an adjusted basis of $156,400, suspended losses of $50,048, and a fair market value at the date of her death of $218,960. Of the $50,048 suspended loss existing at the time of Rose's death, how much is deductible on her final return or by the beneficiary
Answer:
12512 dollars that she have
Rajiv loves watching Downton Abbey on his local public TV station, but he never sends any money to support the station during its fundraising drives. Economists would call Rajiv a . True or False: The government can solve the problem caused by people like Rajiv by sponsoring the show and paying for it with tax revenue collected from everyone. True False True or False: The private market can solve this problem by broadcasting Downton Abbey on cable TV, since then the good would be excludable and thus no longer a public good. True False
Answer:
free rider
true
true
Explanation:
The free rider problem is a form of market failure. It occurs when people benefit from a good or service of communal nature and do not pay to enjoy these services.
Downtown abbey can be classified as a public good, if it is made a private good, the problem would be solved
A public good is a good that is non excludable and non rivalrous.
A private good is a good that is excludable and rivalrous. They are usually exchanged in the market by private sector businesses. It
Cellestial Manufacturing Company produces Products A1, B2, C3, and D4 through a joint process. The joint costs amount to $200,000.
If Processed Further
Sales Value Additional
Product Units Produced at Split-Off Costs Sales Value
A1 3,000 $10,000 $2,500 $15,000
B2 5,000 30,000 3,000 35,000
C3 4,000 20,000 4,000 25,000
D4 6,000 40,000 6,000 45,000
Which product(s) should be sold at split-off to maximize profits in the short run?
a. Product A1
b. Product D4
c. Product B2
d. Products A1 and D4
Answer:
a. Product A1
Explanation:
Calculation to determine Which product(s) should be sold at split-off to maximize profits in the short run
Product A1
Additional Revenues=Sales Value-Sales value at split-Off
Additional Revenues=$15,000-$10,000
Additional Revenues=$5,000
Difference=Additional Revenues -Additional Costs
Difference=$5,000-$2,500
Difference=$2,500
Product A1 Additional Revenues Additional Costs Difference
$5,000 $2500 $2,500
Therefore the product that should be sold at split-off to maximize profits in the short run is Product A1 Which therefore means that company should sell now
Pecan Theatre Inc. owns and operates movie theaters throughout Florida and Georgia. Pecan Theatre has declared the following annual dividends over a six-year period: 20Y1, $80,000; 20Y2, $90,000; 20Y3, $150,000; 20Y4, $150,000; 20Y5, $160,000; and 20Y6, $180,000. During the entire period ended December 31 of each year, the outstanding stock of the company was composed of 250,000 shares of cumulative, preferred 2% stock, $20 par, and 500,000 shares of common stock, $15 par. Assuming a market price per share of $25.00 for the preferred stock and $17.50 for the common stock, determine the average annual percentage return on initial shareholders' investment, based on the average annual dividend per share (a) for preferred stock and (b) for common stock.
Answer:
Pecan Theatre Inc.
Average annual percentage return
Cost Market 20Y1 20Y2 20Y3 20Y4 20Y5 20Y6
per share
Preferred stock $20.00 $25.00 2% 2% 2% 2% 2% 2%
Common stock $15.00 $17.50 0% 0% 0% 0.7% 0.8% 0.11%
Explanation:
a) Data and Calculations:
Dividends: Cumulative Common Stock
Preferred Stock Dividends
Dividends Per share Per share
20Y1, $80,000 $80,000 $0.40 $0 $0
20Y2, $90,000 90,000 $0.40 0 $0
20Y3, $150,000 150,000 $0.40 0 $0
20Y4, $150,000 100,000 $0.40 50,000 $0.10
20Y5, $160,000 100,000 $0.40 60,000 $0.12
20Y6, $180,000 100,000 $0.40 80,000 $0.16
Average annual percentage return
Cost Market 20Y1 20Y2 20Y3 20Y4 20Y5 20Y6
per share
Preferred stock $20.00 $25.00 2% 2% 2% 2% 2% 2%
Common stock $15.00 $17.50 0% 0% 0% 0.7% 0.8% 0.11%
Average annual percentage return = Dividend per share/Initial Cost per share
Jennifer is the sole beneficiary of an irrevocable trust created by her father. Income and principal may be distributed to her at the trustee's discretion. Jennifer has a 5-and-5 power of appointment over the trust. Jennifer died last month at which time the trust was valued at $2,500,000. She did not withdraw any money from the trust this year. How much of the trust was included in her estate at death
Answer:
$125,000
Explanation:
Calculation to determine How much of the trust was included in her estate at death
Since she has 5-and-5 power of appointment over the trust which means that she has the ability to withdraw the GREATER of 5% of fair market value (fmv) of the trust or the amount of $5,000.
Hence, the amount that was included in her estate at death will be $125,000 which is calculated as (5%*trust valued amount of $2,500,000)
Therefore How much of the trust was included in her estate at death is $125,000
Both the demand curve and the supply curve are straight lines. If the price is $4 but only 6 units are bought and sold, producer surplus will be
Answer:
$12
Explanation:
Producer's surplus=1/2*Q*P( Just like the formula for the area of a triangle which is 1/2*base*height)
P is the price of the item which is $4
Q is the quantity bought and sold, which is 6 units in this case, hence, the producer surplus is shown thus
producer's surplus=1/2*$4*6
producer's surplus=$12
Yello Bus Lines uses the units-of-activity method in depreciating its buses. One bus was purchased on January 1, 2019, at a cost of $148,000. Over its 4-year useful life, the bus is expected to be driven 100,000 miles. Salvage value is expected to be $8,000.
Required:
a. Compute the depreciable cost per unit.
b. Prepare a depreciation schedule.
In the current year, Marnie rented her vacation home for 75 days, used it for personal reasons for 22 days, and left it vacant for the remainder of the year. Her income and expenses are as follows: Rental income $ 18,000 Property taxes 2,500 Mortgage interest 3,500 Utilities 1,100 Repairs and maintenance 1,000 Depreciation 5,200 What is Marnie's net income or loss from the activity
Answer: $11123
Explanation:
Based on the information given, Marnie's net income or loss from the activity will be calculated thus:
Rental income = $18000
Less: Property tax = $2500 × 75/365 = $514
Less: Mortgage interest = $3500 × 75/365 = $719
Less: Utilities = $1100 × 75/97 = $851
Less: Repairs and Maintenance = $1000 × 75/97 = $773
Less: Depreciation = $5200 × 75/97 = $4021
Net income = $11,123
At the beginning of the year, Shinedown, Corp., had a long-term debt balance of $46,880. During the year, the company repaid a long-term loan in the amount of $12,805. The company paid $4,890 in interest during the year, and opened a new long-term loan for $11,290. How much is the ending long-term debt account on the company's balance sheet
Answer:
Shinedown, Corp.
The ending long-term debt account on the company's balance sheet is:
= $45,365.
Explanation:
a) Data and Calculations:
Beginning long-term debt balance = $46,880
Repayment of a long-term loan = (12,805)
New long-term loan opened = 11,290
Ending balance of long-term debt = $45,365
Interest payment during the year = $4,890
b) The long-term debt account does not include the interest payment during the year. If any interest is not paid, the amount will be taken as a current liability and not a long-term debt.
Stephen is a graduate student at West University. He works part-time at the campus coffee shop earning $5,000 this year. Stephen also receives a $25,000 scholarship that pays for his tuition, fees, and books. What amount does Stephen include in his gross income
Answer:
5,000
Explanation:
Stephen is a graduate student at a university
He works part time at a shop where he earns 5,000 this is als like compensation
He receives $25,000 for scholarships
The amount Stephen includes in id groas income is 5,000
Who sets the amount or rate of real estate commissions?
Answer:
q
Explanation:
what are the purpose of the information in Management?
Answer:
The purpose of information management is to: design, develop, manage, and use information with insight and innovation. support decision making and create value for individuals, organizations, communities, and societies.
Answer:
It helps dictate how businesses form strategies, and implement processes based on them.
Read the argument below and determine the underlying principle that was used to come to the conclusion presented: A free college education for every citizen is important because it helps the United States create the best-educated workforce in the world. European countries like Germany are able to provide a free college education to their citizens, and the United States should as well. Which other argument uses the same underlying principle as the argument above?
a. Children should get free dental care, even if they drink a lot of soda which causes cavities.
b. Children should get free dental care because it will help prevent more serious issues later on and reduces future healthcare costs.
c. Every child should get free dental care, even if they can afford to pay for it.
Answer:
1. The underlying principle is
to create the best-educated workforce in the world.
2. The argument that uses the same underlying principle as the argument 1 above is:
b. Children should get free dental care because it will help prevent more serious issues later on and reduces future healthcare costs.
Explanation:
The underlying principle is a general rule which can be applied to different situations. It shows the reason for doing something or embarking on a program. For example, to offer free college education for every U.S. citizen, the underlying principle is to "create the best-educated workforce in the world."
Lester hopes to earn $1100 in interest in 1.5 years time from $22,000 that he has available to invest. To decide if it's feasible to do this by investing in an account that compounds quarterly, he needs to determine the annual interest rate such an account would have to offer for him to meet his goal. What would the annual rate of interest have to be
Answer:
The answer is "3.27%"
Explanation:
[tex]P = \$ 22,000\\\\t = 1.5\\\\I= \$ 1,100\\\\A=P+I=\$22,000+1,100=\$ 23,100\\\\n = 4\\\\[/tex]
Using formula:
[tex]\bold{A=P(1+\frac{r}{n})^{nt}}\\\\[/tex]
[tex]23,100=22,000(1+\frac{r}{4})^{4\times 1.5}\\\\23,100=22,000(1+\frac{r}{4})^{6}\\\\\frac{23,100}{22,000}=(1+\frac{r}{4})^{6}\\\\1.05=(1+\frac{r}{4})^{6}\\\\1.05^{\frac{1}{6}}=(1+\frac{r}{4})\\\\1.008164846=(1+\frac{r}{4})\\\\1.008164846-1=\frac{r}{4}\\\\0.008164846=\frac{r}{4}\\\\r=0.008164846\times 4\\\\r=0.03266\\\\r=3.266\% \approx 3.27\%[/tex]
