A quantity of steel in the amount of $423,000.0 is needed for a project, payment due (from contractor to steel fabricator) at the project begin date. The steel is expected to be erected in Month 2 and Month 3, with billing at the end of these months and subsequent payment from the owner (to the contractor) at the end of Month 3 and Month 4. Assume half the the payment occurs at the end of Month 3 and the other half at the end of Month 4. Using an annual interest rate of 18%, which is a monthly interest rate of 1.5%, to finance the purchase with a short-term line of credit loan, determine the total interest accumulated for this steel purchase until payment is received (from the owner) Please do fast .... ASAP .. fast...
Q: A company currently pays a dividend of $1.8 per share (D0 = $1.8). It is estimated that the…
A: Dividend paid = $1.8Growth rate for first 2 years = 15%Constant growth rate = 8%Beta = 1.8Risk-free…
Q: Carnival Corporation (CCL) recently sold new bonds at discount price of $949.44. The bonds have a…
A: Here,
Q: What is the present value of a Annuity where the investor receives $10,000 every year for 10 years…
A: Annuity = a = $10,000Time = t = 10 yearsInterest rate = r = 4.5%
Q: following information has been collected on this investment: Old Equipment Cost Accumulated…
A: The payback period represents the period in which the initial cost of an investment is recovered.
Q: Problem 2-33 Income Statement (LG2-1) Listed below is the income statement for Tom and Sue Travels,…
A: Cost of goods sold is actual cost of goods being sold to customers. Gross profit is excess of net…
Q: Can you solve using excel and explain the formulas more in depth?
A: Here,Market Cap is 300 billion pesoNext Year FCF is 9.6 billion pesoGrowth Rate is 8.60%
Q: The following questions are based on a stock and its derivatives. Relevant information is listed in…
A: Working Note #1Computation of WACC:WACC=[Cost of debt * Wt. of debt * (1-Tax rate)]+ [Cost of equity…
Q: Baker Industries' net income is $27000, its interest expense is $5000, and its tax rate is 40%. Its…
A: Net Income = ni = $27,000Interest Expenses = i = $5000Tax rate = t = 40%notes payable = np = $27,000…
Q: Novak Inc. now has the following two projects available: Project 1 2 Initial CF -11,659.64 -3,369.54…
A: The NPV of a project refers to the profitability of the project by discounting cash flows to find if…
Q: Cost-Cutting Proposals [LO2] Tanaka Machine Shop is considering a four-year project to improve its…
A: Net present value is the difference between the present value of cash inflows and present value of…
Q: Your parents have accumulated a $130,000 nest egg. They have been planning to use this money to pay…
A: Data given: Current savings=$130000 Nail Salon financing=$22000 Year end vacation cost per…
Q: Your grandfather would like to share some of his fortune with you. He offers to give you money under…
A: Scenario 1Scenario 2Scenario 3Payment (A)$8,750$50,050$98,650Interest Rate (B) 6%6%6%Periods…
Q: Problem 4: You borrow a GPM of $120,000 with annual payments and 30-year term. The interest rate is…
A: In the given question, the person has borrowed GPM of $120,000 with annual payments and 30 year…
Q: Payment of Duty and Duty-Related Carrying Cost Liston, Inc., owns a factory located close to, but…
A: Data given:Carrying cost per year=8%Average holding period=9 months.
Q: The per-gallon value of this opportunity today is $ 0.5839
A: As per the question, we are asked to evaluate the value of an opportunity for a gas company to sell…
Q: Yeadon Construction's stock is expected to earn 5 percent in a weak economy, 12 percent in a normal…
A: Expected rate of return=Respective return*Respective Probability
Q: Managers wishing to avoid loan covenant violations may resort to making accounting changes that…
A: It's critical to read the terms and conditions of any loan you're thinking about, paying close…
Q: Deep Mines has 43,800 shares of common stock outstanding with a beta of 1.54 and a market price of…
A: Beta = b = 1.54Market return = rm = 7.5%Risk free rate = t bill yield = rf = 3.6%
Q: (Related to Checkpoint 5.6) (Solving for ) You are considering investing in a security that will pay…
A: Future value = $2000Period = 28 yearsDiscount rate = 12%
Q: The certainty equivalent method Choice 1 of 4:increases the valuation relative to the standard…
A: Certainty Equivalent ,the amount that is guaranteed cash that the person will accept instead of…
Q: Contrast the Nasdag and National Market System with the OTCBB. Describe the conversion priviege on a…
A: It is essential to comprehend the many trading platforms and securities available in the world of…
Q: Wildhorse Corp. has 18-year bonds outstanding. These bonds, which pay interest semiannually, have a…
A: As per instruction question 8.30(c) will be attempted. YTM is the annual return that the bond…
Q: Sean's investment of $81,400.00 in a fund matured to $155,777.80 in 8 years. If the interest in the…
A: The periodic interest rate refers to the return that the investment provides for each period. The…
Q: ou were asked to estimate the cost of common based on the three most commonly used methods and then…
A: We can determine the cost of equity in 3 ways.1. Bond yield + Risk PremiumCost of equity = Bond…
Q: The following table shows your stock positions at the beginning of the year, the dividends that each…
A: CompanySharesBeginning of year PriceDividend Per ShareEnd of Year PriceUS…
Q: Answer this question based on the dividend growth model. If you expect the required rate of return…
A: The required rate of return represents the minimum return an investor will seek for taking on the…
Q: The management of Unter Corporation, an architectural design firm, is considering an investment with…
A: The payback period represents the period in which the cost of the initial investment is recovered by…
Q: A young person has just started work borrowed $7,500 to purchase a car. They can afford to make…
A: Since you have posted a question with multiple sub parts, we will provide the solution only to the…
Q: Islander Corporation's common stock will pay a dividend of $3.50 one year from now. The annual…
A: Current price refers to the present value of the future cash payment that is helpful in deciding…
Q: Karen obtained a $25,000 loan at 4.5% compounded semiannually. a-1. What monthly payment will repay…
A: The present value concept is useful for borrowers to assess the affordability of a loan. By…
Q: Pick the best answer to the following portfolio? (Round off all numbers to 2 decimal places) Stock…
A: A portfolio refers to the collections of various financial instruments such as stocks, bonds,…
Q: Use the following data to complete the QUIZ: YEAR 0 1 2 3 4 WACC = 12.0000% Expected Net Cash Flow…
A: As per the Honor code of Bartleby we are bound to give the answer of first three sub part only,…
Q: hael wants to have $68,000 in 12 years on a savings plan that requires monthly contributions. If he…
A: Future value of investment includes the amount being deposited over the years and amount of interest…
Q: With the help of examples, explain how futures contracts can be used to reduce systematic risk in…
A: The future contract are important part of hedging and other strategy. The value is based on the…
Q: A company issued bonds with a 30-year maturity, a $1,000 par value, a 13.0% coupon rate, and…
A: A bond refers to a debt instrument used to raise capital from investors rather than traditional…
Q: XYZ is evaluating a project that would require the purchase of a piece of equipment for $560,000…
A: The financial statement analysis refers to the measurement of the performance of the company based…
Q: Given: Firm A is all-equity financed and has total assets of $200 million. Firm B is an identical…
A: In the financial statement interest of debt obligation is deducted from EBIT in order to arrive at…
Q: You are buying a new home, and you have negotiated a 15-year mortgage loan with a local bank for an…
A: Annuity refers to the equal amount of payment made. In this case the monthly payments for loan…
Q: Suppose you plan to retire in 40 years. If you make annual contributions of $12,000 into your…
A: FV of annuity=Pmt*((1+r)n-1) /rFV of a single amount= Present value*(1+r)n
Q: ewly issued bond pays its coupons once a year. Its coupon rate is 4.3%, its maturity is 10 years,…
A: Tax on capital gain is calculated as shown below. Tax on coupon or interest income is…
Q: Suppose the value of the S&P 500 stock index is currently 2,400. a. If the 1-year T-bill rate is 6%…
A: Futures price is the spot price plus the risk-free return on it. If the underlying asset has…
Q: The pecking order states that firms should: Group of answer choices issue debt first. use internal…
A: The pecking order theory is a theory of capital structure that suggests that firms have a preference…
Q: e Fourth Corp. is evaluating extra cash dividends versus share repurchases. In either case, $6,675…
A: Some time when company have extra cash than company pay dividends or may repurchase own shares from…
Q: A mortgage of $360000 at 4.8% compounded semi-annually, is amortized over 25 years. Payments are…
A: First, we need to determine the annual equivalent interest rate using the formula below. This is…
Q: Robert Finley wishes to become a millionaire. His money market fund has a balance of $111,780 and…
A: To calculate the number of years Robert must leave his money in the fund to reach his desired…
Q: XYZ is considering buying a new, high efficiency interception system. The new system would be…
A: Net Present Value is also known NPV. It is a capital budgeting technique which help in decision…
Q: and you You have decided to refinance your mortgage. You plan to borrow whatever is outstanding on…
A: Present value is the value of loan or future periodic payments at the present date.
Q: JenBritt Incorporated had a free cash flow (FCF) of $76 million in 2019. The firm projects FCF of…
A: When will calculating the value of operation we will be considering the total growth rate and the…
Q: given a stock with a current price of 85.50, exercise price of 83.75, put price of 2.60, call price…
A: The put-call parity refers to the relationship between the prices of the call and the put options on…
Q: You just turned 22 years old and want to retire when you turn 65. You plan to put $4,000 every year…
A: Here,ParticularsValuesAge at the time of beginning22.00Age at the time of retirement65.00Annual…
Step by step
Solved in 3 steps with 2 images
- A quantity of steel in the amount of $423,000.0 is needed for a project, payment due (from contractor to steel fabricator) at the project begin date. The steel is expected to be erected in Month 2 and Month 3, with billing at the end of these months and subsequent payment from the owner (to the contractor) at the end of Month 3 and Month 4. Assume half the the payment occurs at the end of Month 3 and the other half at the end of Month 4. Using an annual interest rate of 18%, which is a monthly interest rate of 1.5%, to finance the purchase with a short-term line of credit loan, determine the total interest accumulated for this steel purchase until payment is received (from the owner).Seasons Construction is constructing an office building under contract for Cannon Company and uses the percentage-of-completion method. The contract calls for progress billings and payments of $1,550,000 each quarter. The total contract price is $18,600,000 and Seasons estimates total costs of $17,750,000. Seasons estimates that the building will take 3 years to complete, and commences construction on January 2, 2018. In 2018, it incurs cost of $5,325,000. At December 31, 2019, Seasons Construction estimates that it is 75% complete with the building; however, the estimate of total costs to be incurred has risen to $18,000,000 due to unanticipated price increases. What is the cost that Seasons has incurred during the year ended December 31, 2019? Group of answer choices $7,875,000 $8,175,000 $7,987,500 $13,500,000Blossom Construction is constructing an office building under contract for Cannon Company and uses the percentage-of-completion method. The contract calls for progress billings and payments of $1450000 each quarter. The total contract price is $18492000 and Blossom estimates total costs of $17650000. Blossom estimates that the building will take 3 years to complete, and commences construction on January 2, 2018. At December 31, 2018, Blossom estimates that it is 30% complete with the construction, based on costs incurred. What is the total amount of Revenue from Long- Term Contracts recognized for 2018 and what is the balance in the Accounts Receivable account assuming Cannon Company has not yet made its last quarterly payment? Revenue $6164000 $5547600 $5295000 $5295000 O Option A Option B O Option C Accounts Receivable $6164000 $1450000 $1450000 $6164000
- Sheridan Construction is constructing an office building under contract for Cannon Company and uses the percentage-of-completion method. The contract calls for progress billings and payments of $1200000 each quarter. The total contract price is $18222000 and Sheridan estimates total costs of $17400000. Sheridan estimates that the building will take 3 years to complete, and commences construction on January 2, 2021.At December 31, 2021, Sheridan estimates that it is 20% complete with the construction, based on costs incurred. What is the total amount of Revenue from Long-Term Contracts recognized for 2021 and what is the balance in the Accounts Receivable account assuming Cannon Company has not yet made its last quarterly payment? Revenue Accounts Receivable $3480000 $1200000 $6074000 $6074000 $3480000 $6074000 $3644400 $1200000Ivanhoe Construction is constructing an office building under contract for Cannon Company and uses the percentage-of-completion method. The contract calls for progress billings and payments of $900000 each quarter. The total contract price is $17898000 and Ivanhoe estimates total costs of $18100000. Ivanhoe estimates that the building will take 3 years to complete, and commences construction on January 2, 2021. At December 31, 2021, Ivanhoe estimates that it is 30% complete with the construction, based on costs incurred.At December 31, 2022, YellowStone Construction estimates that it is 70% complete with the building; however, the estimate of total costs to be incurred has risen to $18300000 due to unanticipated price increases. What is the total amount of Construction Expenses that Ivanhoe will recognize for the year ended December 31, 2022? $7440600 $7380000 $7300600 $12810000Seasons Construction is constructing an office building under contract for Cannon Company and uses the percentage-of-completion method. The contract calls for progress billings and payments of $5,000,000 each year. The total contract price is $15,000,000 and Seasons estimates total costs of $12,000,00O. Seasons estimates that the building will take 3 years to complete, and commences construction on January 2, 2021. At December 31, 2021, Seasons estimates that it is 30% complete with the construction, based on costs incurred, which are consistent with the original estimate. Prepare the journal entries required in 2021, if any, to record construction costs, revenues, and billings.
- YellowStone Construction is constructing an office building under contract for LimeStone Company and uses the percentage-of-completion method. The contract calls for progress billings and payments of $1300000 each quarter. The total contract price is $15600000 and YellowStone estimates total costs of $17500000. YellowStone estimates that the building will take 3 years to complete, and commences construction on January 2, 2021. At December 31, 2022, YellowStone Construction estimates that it is 75% complete with the building; however, the estimate of total costs to be incurred has risen to $17750000 due to unanticipated price increases.YellowStone Construction completes the remaining 25% of the building construction on December 31, 2023, as scheduled. At that time the total costs of construction are $18500000. What is the total amount of Revenue from Long-Term Contracts and Construction Expenses that YellowStone will recognize for the year ended December 31, 2023? Revenue Expenses…SMDC Construction is constructing an office building under contract for Onyx Company and uses the percentage-of-completion method. The contract calls for progress billings and payments of P1,550,000 each quarter. The total contract price is P18,600,000 and SMDC Construction estimates total costs of P17,750,000. SMDC Construction estimates that the building will take 3 years to complete, and commences construction on January 2, 2018. SMDC Construction completes the remaining 25% of the building construction on December 31, 2020, as scheduled. At that time the total costs of construction are P18,750,000. What is the total amount of Revenue from Long-Term Contracts and Construction Expenses that SMDC Construction will recognize for the year ended December 31, 2020? Revenue Expenses A. P18,600,000 P18,750,000 B. P4,650,000 P 4,687,500 C. P4,650,000 P 5,250,000 D. P4,687,500 P 4,687,500 Group of answer choices D C B ABridgenorth has undertaken a $5 million contract to repair a railway tunnel. The contract was signed on 1 April 20X8 and the work is expected to take two years. This is a contract where performance obligations are satisfied over time and progress in satisfying performance obligations is to be measured according to % of work completed as certified by a surveyor. Bridgenorth has an enforceable right to payment for performance completed to date. At 31 December 20X9 the details of the contract were as follows: 20X9 20X8 $ $ Total contract value 5,000,000 5,000,000 Costs to date 3,600,000 2,300,000 Estimated costs to completion 700,000 2,100,000 Work invoiced to date 3,000,000 2,000,000 Cash received to date 2,400,000 1,500,000 % certified complete 75% 40% What is the profit recognised for the year ended 31 December 20X8?
- Curtiss Construction Company, Incorporated, entered into a fixed price contract with Axelrod Associates on July 1, 2024, to construct a four story office building. At that time, Curtiss estimated that it would take between two and three years to complete the project. The total contract price for construction of the building is $4,240,000 The building was completed on December 31, 2026 Estimated percentage of completion, accumulated contract costs incurred, estimated costs to complete the contract, and accumulated billings to Axelrod under the contract were as follows Percentage of completion Cests incurred to date Estimated costs to complete Billings to Axelrod, to date Required: At 12-11-2024 10% At 12-31-2025 $2,688,000 1,792,000 AT 12-11-2026 60% 100% $ 4,534,000 4,240,000 $363,000 3,267,000 724,000 2,250,000 1. Compute gross profit or loss to be recognized as a result of this contract for each of the three years. Curtiss concludes that the contract does not qualify for revenue…Seasons Construction is constructing an office building under contract for Cannon Company and uses the percentage-of-completion method. The contract calls for progress billings and payments of $1,550,000 each quarter. The total contract price is $18,600,000 and Seasons estimates total costs of $17,750,000. Seasons estimates that the building will take 3 years to complete and commences construction on January 2, 2024. At December 31, 2024, Seasons estimates that it is 30% complete with the construction, based on costs incurred. By December 31, 2025, Seasons estimates that it is 75% complete with the building; however, the estimate of total costs to be incurred has risen to $18,000,000 due to unanticipated price increases. What is the total amount of Construction Expenses that Seasons will recognize for the year ended December 31, 2025? $13,500,000 O $7,875,000 $7,987,500 O $8,175,000On February 1, 2020, Mar Contractors agreed to construct a building at a contract price of $15,400,000. Mar initially estimated total construction costs would be $12,000,000 and the project would be finished in 2023. Information relating to the costs and billings for this contract during 2020-2022 is as follows: Total costs incurred during the year Estimated costs to complete Customer billings to date Collections to date 2020 4,500,000 7,500,000 6,600,000 6,000,000 2021 5,300,000 4,200,000 12,000,000 10,500,000 2022 4,000,000 1,800,000 13,800,000 13,500,000 a. Using the percentage-of-completion method, prepare schedules to compute the profit or loss to be recognized as a result of this contract and all the necessary journal entries for the years ended December 31, 2020, 2021, and 2022. b. Using the cost-recovery method, prepare schedules to compute the profit or loss to be recognized as a result of this contract all the necessary journal entries to record the costs,…