Questions from Financial Accounting

Q: An oil-drilling company figures that it must spend $30

An oil-drilling company figures that it must spend $30,000 for an initial supply of drill bits and that it must spend $10,000 every month to replace the worn-out bits. What is the present value of the...

Q: If you promise to leave $30,000 on deposit at

If you promise to leave $30,000 on deposit at the Dime Savings Bank for four years, the bank will give you a new large, flat-screen Sony TV today and your $30,000 back at the end of four years. How mu...

Q: Mme. Barefield wishes to have $150,000 at the

Mme. Barefield wishes to have $150,000 at the end of 8 years. How much must she invest today to accomplish this purpose if the interest rate is a. 6% per year? b. 8% per year?

Q: When Mr. Shafer died, his estate after taxes amounted to

When Mr. Shafer died, his estate after taxes amounted to $300,000. His will provided that Mrs. Shafer would receive $24,000 per year starting immediately from the principal of the estate and that the...

Q: Mrs. Heileman occasionally drinks beer. (Guess which brand.)

Mrs. Heileman occasionally drinks beer. (Guess which brand.) She consumes one case in 20 weeks. She can buy beer in disposable cans for $25.20 per case or for $24.00 per case of returnable bottles if...

Q: When General Electric Company first introduced the Lucalox ceramic, screw-

When General Electric Company first introduced the Lucalox ceramic, screw-in light bulb, the bulb cost three and one-half times as much as an ordinary bulb but lasted five times as long. An ordinary b...

Q: The balance sheet of Lynch Company shows net assets (= total assets

The balance sheet of Lynch Company shows net assets (= total assets – total liabilities) of $100,000 and shareholders’ equity of $100,000. The assets are all depreciable assets with remaining lives of...

Q: When the American Basketball Association (ABA) merged with the National

When the American Basketball Association (ABA) merged with the National Basketball Association (NBA), the owners of the ABA St. Louis Spirits agreed to dissolve their team and not enter the NBA. In re...

Q: Mr. Case plans to set aside $4,000 each

Mr. Case plans to set aside $4,000 each year, the first payment to be made on January 1, 2013, and the last on January 1, 2018. How much will he have accumulated by January 1, 2018, if the interest ra...

Q: Ms. Namura wants to have ¥45 million on her 65th

Ms. Namura wants to have ¥45 million on her 65th birthday. She asks you to tell her how much she must deposit on each birthday from her 58th to 65th, inclusive, in order to receive this amount. Assume...