Town station is saving money to build a new loading platform. Three years ago they set aside 23,000 for this purpose. Today, that account is worth $31,406. What rate of interest is town station earning on this investment?

Town station is saving money to build a new loading platform. Three years ago they set aside 23,000 for this purpose. Today, that account is worth $31,406. What rate of interest is town station earning on this investment?

Name: Town station is saving money to build a new loading platform. Three ye
Uploaded: 2024-03-20T06:50:59.000Z
Channel: Bartleby
Description: Town station is saving money to build a new loading platform. Three years ago they set aside 23,000 for this purpose. Today, that account is worth $31,406. What rate of interest is town station earning on this investment? Could

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter11: Capital Budgeting Decisions

Section: Chapter Questions

Problem 10PA: The Ham and Egg Restaurant is considering an investment in a new oven that has a cost of $60,000,...

See similar textbooks

Similar questions

A small town in Ohio is considering the purchase of a new parking system that would enhance the collection of parking fees while providing additional convenience to shoppers. The hardware requires an immediate investment of $950. The town estimates that the new system will create an annual cash flow of $204 to be received at the end of each year, beginning in one year, for 7 consecutive years. And, in addition, the project will produce a terminal cash flow in year 8 of $304. What is the payback, in years, of the computer package?YearsPlace your answer in number of years, as an integer (whole number)
Your neighborhood laundromat is for sale and a friend is considering investing in this business. Your friend has asked for your financial advice regarding this endeavor. For the business alone and no other assets (such as the building and land), the purchase price is $250,000. The net cash flows for the project are $30,000 per year for the next 5 years. The plan is to borrow the money for this investment at 6%. You will need to submit a presentation sharing your recommendation and you must address the following questions:Part A: Calculate the Net Present Value and Payback Period: What is the net present value of this project? Calculate the simple payback period for this project. Your desired payback period is 5 years. How long is the payback period for this project? Use the following template to complete the Unit 4 Excel spreadsheet (IP): Unit 4 IP Assignment Template Part B: Evaluate the investment and provide calculations for an alternative deal: How would you evaluate this…
One year ago, the Jenkins Family Fun Center deposited $3,400 into an investment account for the purpose of buying new equipment four years from today. Today, they are adding another $5,200 to this account. They plan on making a final deposit of $7,400 to the account next year. How much will be available when they are ready to buy the equipment, assuming they earn a rate of return of 6 percent? Multiple Choice $19,019.26 $19,928.37 $17,421.48 $19,431.85 $18.516.29
Blossom Googal owns a garage and is contemplating purchasing a tire retreading machine for $32.820. After estimating costs and revenues, Blossom projects a net cash inflow from the retreading machine of $4,700 annually for 11 years. Blossom hopes to earn a return of 8% on such investments. Click here to view the factor table. (For calculation purposes, use 5 decimal places as displayed in the factor table provided.) What is the present value of the retreading operation? (Round answer to 2 decimal places, eg. 25.25) Present value 2$ Should Blossom Googal purchase the retreading machine?
You are a real estate agent thinking of placing a sign advertising your services at a local bus stop. The sign will cost $4,700 and will be posted for one year. You expect that it will generate additional revenue of $705 a month. What is the paybackperiod?
The city is building bridge that will cost 1.2 million dollars today and $25,000 per year to maintain. How much money needs to be invested today at a 10% interest rate to ensure the city has the payments to begin and maintain the project? Please explain in as detail as possible.
Your neighborhood laundromat is for sale and a friend is considering investing in this business. Your friend has asked for your financial advice regarding this endeavor. For the business alone and no other assets (such as the building and land), the purchase price is $250,000. The net cash flows for the project are $30,000 per year for the next 5 years. The plan is to borrow the money for this investment at 5%. What is the net present value of this project? Calculate the simple payback period Your desired payback period is 5 years. How long is the payback period. How would you evaluate this investment? What would be a good price at which to purchase this business?
One year ago the Jenkins Family Fun Center deposited $5000 in an investment account for the purpose of buying new equipment four years from today. Today, they ae adding another $$6800 to this account. They plan on making a final deposit of $9000 to the account next year. Hoow wmuch will be available when they are ready to buy the equipment, assuming they earn 8-percent rate of return
Cryptocurrency Finder is buying the first computer for their new server farm. Suppose the company paid $5,000for this computer, which it expects to last for three years. Describe how the company would account for the $5,000 expenditure under (a) the cash basis and (b) the accrual basis. State in your own words why the accrual basis is more realistic for this situation.
Your supervisor has tasked you with evaluating several loans related to a new expansion project. Using the PVIFA table (table 9.4 in the textbook), determine the annual payment on a $400,000, 8% business loan from a commercial bank that is to be amortized over a five-year period. Show your work. Does this payment seem reasonable? Explain.
A college plans to build a new dormitory building. A group of alumni volunteered to donate enough funds to cover all the maintenance cost of the dormitory. As an analyst working for the college, you are asked to determine the amount of the donation. You are told that the maintenance cost of the dormitory will be $35,000 per year for the first 20 years. Then it will increase to $45,000 per year for years 21 through 30, and to $60,000 per year after that. The dormitory is assumed to have an indenite service life. The college will place the funds on an account that will pay 12% interest compounded annually. How large should the donation be? A) $500,000 B) $304,478 C) $347,231 D) Answers A, B and C are not correct
Two years ago, Lou Marshall, Inc. deposited $18,125 in an investment account for the purpose of buying new equipment four years from today. Last year, it added another $20,212 to this account. The company plans on making a final deposit of $17,503 to the account today. How much will be available when it is ready to buy the equipment, assuming the company earns 13.27% APR on its invested funds? Choose the closest amount. $118,681.22 $92,502.23 $91,918.47 $104,777.28 $72,097.87