Category: Uncategorized

XYZ Company has forecasted June sales of 400 units and July sales of 700 units. The company maintains ending inventory equal to 125% of next month’s sales. June beginning inventory reflects this policy. What is June’s required production?

Julia purchases a new piece of equipment for her business. The equipment was purchased for $65,000 and is expected to generate the following cash flows at the end of each year for the next seven years: $14,000 (year 1), $19,000 (year 2), $21,000 (year 3), $21,000 (year 4), $16,000 (year 5), $11,000 (year 6), and $9,000 (year 7). Assume the equipment can be sold for $10,000 at the end of 7 years and Julia required rate of return is 9%. What is the net present value of this investment?

Carissa invests $20,000 in a limited partnership today. At the end of each years 1 through 5, she will receive the after-tax cash flows shown below. The partnership will be liquidated at the end of the fifth year. Carissa is in the 35% federal income bracket. Years Cash Flows 0 – $20,000 CF0 1 $0 CF1 2 $4,000 CF2 3 $6,000 CF3 4 $8,000 CF4 5 $10,000 CF5 The after-tax IRR on this investment is:

Kobe works at a hotel in accounting. He is planning on purchasing a home and has met with an insurance agent. However, he is not clear about all the policies that they discussed. Which of the following statements is correct?

Which of the following statements is/are correct? Net worth represents the personal equity that the individual has in his assets and can be less than zero. If Lisa purchased a car using 30% cash and 70% debt, her net worth would increase by 30%.

Billy owns one share of Disney stock. He purchased the share 3 years ago for $15. Disney stock is currently trading for $25 per share. The stock has paid the following dividends over the past three years: year 1, $1.00; year 2, $2.00; year 3, $3.00. What is the compounded rate of return (IRR) that Billy has earned on his investment?

Jade is looking for an insurance policy for her home. Her friend, Shamus, who is an attorney, just told her that the policy is a contract and has some unique characteristics. Which of the following terms applies to the insurance contract? Indemnity. Aleatory. Adhesive.

Damian invests $5,000 today in an account earning 6% per year. How much is the investment worth in 4 years?

Ralph owns a home with a fireplace and a generator. He has stacks of wood and several 55-gallon drums of camping oil in his garage. He likes to go camping and leaves his home for several days at a time, often with a fire burning in his fireplace. In addition, he leaves his home unlocked. Which of the following hazards apply?

Which of the following is likely to require coverage under an endorsement (rider) to a homeowners policy to obtain adequate coverage? Gun collection. Jewelry. Rare coins.