Homework Answers
| 1 | Present value of winnings=Annual installment*Present value at 10% for 20 years=68000*8.51356=$ 578922 | ||||
| 1a. | Present value of first option=Lump-sum payment=$ 130000 | ||||
| Present value of second option=Present value of annual payment for 5 years at 11%+Present value of lump-sum payment at the end of 5th year at 11% | |||||
| Present value of second option=(19000*3.69590)+(75000*0.59345)=70222+44509=$ 114731 | |||||
| Maximum amount willing to pay for the new computer system=Present value of annual savings over the life of computer system | |||||
| 1 | Eight percent: | ||||
| Present value=Annual savings*Present value at 8% for 3 years=5000*2.5771=$ 12886 | |||||
| 2 | Ten percent: | ||||
| Present value=Annual savings*Present value at 10% for 3 years=5000*2.48685=$ 12434 | |||||
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We were unable to transcribe this imageThe Atlantic Medical Clinic can purchase a new computer system...
The Atlantic Medical Clinic can purchase a new computer system that will save $9,000 annually in...
The Atlantic Medical Clinic can purchase a new computer system that will save $9,000 annually in billing costs. The computer system will last for ten years and have no salvage value. Use Excel or a financial calculator to solve. Round answers to the nearest dollar. Required: Up to how much should the Atlantic Medical Clinic be willing to pay for the new computer system if the clinic's required rate of return is: Present Value | 1. Eight percent 2. Fourteen...
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The Atlantic Medical Clinic can purchase a new computer system that will save $9,000 annually in...
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Julie has just retired. Her company's retirement program has two options as to how retirement benefits can be received. Under the first option, Julie would receive a lump sum of $130,000 immediately as her full retirement benefit. Under the second option, she would receive $19,000 each year for 5 years plus a lump-sum payment of $75,000 at the end of the 5-year period. Click here to view Exhibit 128-1 and Exhibit 128-2, to determine the appropriate discount factors) using tables....
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The Atlantic Medical Clinic can purchase a new computer system that will save $4,000 annually in billing costs. The computer system will last for twelve years and have no salvage value. Click here to view Exhibit 128-1 and Exhibit 128-2, to determine the appropriate discount factor(s) using tables. Required: What is the maximum price (ie, the price that exactly equals the present value of the annual savings in billing costs) that the Atlantic Medical Clinic should be willing to pay...
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The Atlantic Medical Clinic can purchase a new computer system that will save $9,000 annually in billing costs. The computer system will last for eleven years and have no salvage value. Click here to view Exhibit 138-1 and Exhibit 13B-2. to determine the appropriate discount factor(s) using tables Required: What is the maximum price (ie, the price that exactly equals the present value of the annual savings in billing costs) that the Atlantic Medical Clinic should be willing to pay...
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Julie has just retired. Her company's retirement program has two options as to how retirement benefits can be received. Under the first option, Julie would receive a lump sum of $141,000 immediately as her full retirement benefit. Under the second option, she would receive $20,000 each year for 8 years plus a lump-sum payment of $60,000 at the end of the 8-year period. Click here to view Exhibit 7B-1 and Exhibit 7B-2, to determine the appropriate discount factor(s) using tables....
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