Question

5. Use the following future value information to answer the questions below. Periods Future Value of $1 at 12 Percent Future. Value of Ordinary Annuity of $1 at 12 percent 1.120 1.000 NP 1.254 2.120 1.405 3.374 If an accumulation of $500 is desired at the end of three years, what amount must be deposited now to accomplish that goal? [A] $446.43 [B] $355.87 [C] $267.86 [D] $148.19

Answer 1

Answer:

25)

FV=	PV*(1+r)^n
500=	PV*(1.12)^3
PV=	500/1.405
PV=	$ 355.87

27)

FV of annuity	P[(1+r)^n-1]/r
	=200[(1.12)^3-1]/.12
	=200*3.374 = $674.8

28)

						Inventory on hand
			Units	Price	Total	Units	Price	Total
Nov	1	Inventory	15	$      4.00	$60	15	$      4.00	$   60.00
	8	Purchase	60	$      4.40	$264	75	$      4.32	$ 324.00
	17	Purchase	30	$      4.20	$126	105	$      4.29	$ 450.00
	25	Purchase	45	$      4.80	$216	150	$      4.44	$ 666.00
	100	Sale				50	$      4.44	$ 222.00

COGS under Average Cost method	=100 units * $4.44
	$444

29)

COGS under FIFO		=60+264+126*25/30
		$       429

30)

COGS under LIFO		=216+126+264*25/60
		$       452