1. Randy Owen invested $6,700 at 12% annual interest, and left the money invested without withdrawing any of the interest for 10 years. At the end of the 10 years, Randy withdrew the accumulated amount of money.



(a) What amount did Randy withdraw, assuming the investment earns simple interest?

The amount Randy withdrew
$

(b) What amount did Randy withdraw, assuming the investment earns interest compounded annually? (Round answer to 2 decimal places, e.g. 25.25.)

The amount Randy withdrew
$


2.
For each of the following cases,

(1) In Table 1 (future value of 1):

Annual Rate
Number of
Years Invested
Compounded
Case A
4%
6 Annually
Case B 10% 6 Semiannually

(2) In Table 2 (future value of an annuity of 1):

Annual Rate
Number of
Years Invested
Compounded
Case A
4%
10 Annually
Case B 10% 6 Semiannually

Indicate to what interest rate columns you would refer in looking up the future value factor.

Table 1
Table 2
Case A
%
%
Case B
%
%

Indicate to what number of periods you would refer in looking up the future value factor.

Table 1
Table 2
Case A
periods
periods
Case B
periods
periods


3. Joyce Company signed a lease for an office building for a period of 10 years. Under the lease agreement, a security deposit of $7,400 is made. The deposit will be returned at the expiration of the lease with interest compounded at 10% per year.



What amount will Joyce receive at the time the lease expires? (Round answer to 2 decimal places, e.g. 25.25.)

Amount at the time the lease expires
$

4. Bates Company issued $1,200,000, 10-year bonds and agreed to make annual sinking fund deposits of $79,000. The deposits are made at the end of each year into an account paying 8% annual interest.



What amount will be in the sinking fund at the end of 10 years? (Round answer to 2 decimal places, e.g. 25.25.)

Amount in the sinking fund
$

5. Frank and Maureen Fantazzi invested $5,800 in a savings account paying 8% annual interest when their daughter, Angela, was born. They also deposited $1,400 on each of her birthdays until she was 15 (including her 15th birthday).



How much was in the savings account on her 15th birthday (after the last deposit)? (Round answer to 2 decimal places, e.g. 25.25.)

Amount on 15th birthday
$

6. Hugh Curtin borrowed $33,100 on July 1, 2012. This amount plus accrued interest at 5% compounded annually is to be repaid on July 1, 2017.



How much will Hugh have to repay on July 1, 2017? (Round answer to 2 decimal places, e.g. 25.25.)

Amount to be repaid on July 1, 2017
$

7. For each of the following cases,

(1) In Table 3 (present value of 1):

Annual Rate
Number of
Years Involved
Discounts
per Year
Case A
8% 5 Annually
Case B 11% 8 Annually
Case C 8% 9 Semiannually

(2) In Table 4 (present value of an annuity of 1):

Annual Rate
Number of
Years Involved
Number of
Payments Involved
Frequency of
Payments
Case A
11% 18 18 Annually
Case B 11% 6 6 Annually
Case C 8% 4 8 Semiannually

Indicate to what interest rate columns you would refer in looking up the discount rate.

Table 3
Table 4
Case A
%
%
Case B
%
%
Case C
%
%

Indicate to what number of periods you would refer in looking up the discount rate.

Table 3
Table 4
Case A
periods
periods
Case B
periods
periods
Case C
periods
periods

8.

(a) What is the present value of $29,900 due 10 periods from now, discounted at 8%? (Round answer to 2 decimal places, e.g. 25.25.)



Present value
$


(b) What is the present value of $29,900 to be received at the end of each of 6 periods, discounted at 5%? (Round answer to 2 decimal places, e.g. 25.25.)



Present value
$

 

Looking for a Similar Assignment? Order now and Get 10% Discount! Use Coupon Code "Newclient"

FINAL EXAM

ACC/400

Accounting for Decision Making

1. Trim Force Corp. had the following information in their accounting records:

Work in process inventory, beginning balance	$50,000
Cost of direct materials used	$350,000
Direct labor cost applied to production	$200,000
Cost of finished goods manufactured	$750,000

Manufacturing overhead during production was $250,000. What was the work in process inventory on hand at the end of the year?

• Walsh Corp. uses direct labor hours to determine their applied manufacturing overhead. They use a rate of $30 per direct labor hour. During the production period, company employees worked 10,000 direct labor hours, and had actual overhead costs of $305,000.
• Record the year-end journal entry to close out the Manufacturing Overhead account to the Cost of Goods Sold account.
• Was manufacturing overhead underapplied or was it overapplied?

• Sorin Corp. uses process costing for its two production departments: Cutting and Painting. The company’s manufacturing information for the month of August is provided below:

	Cutting	Painting
Beginning work in process	$1,000	$1,200
Costs transferred in	?	?
Costs incurred in Aug	$3,500	$5,000
Ending work in process	$2,000	$2,500

1. Record the transfer costs from the cutting department to the painting department in Aug.
2. Record the transfer costs from the painting department to the finished goods inventory account in Aug.

• Badin Corp. has the following information about its most popular product line:

Sales price per unit	$50
Variable cost per unit	$25
Total fixed manufacturing & overhead costs	$400,000

Compute the following:

1. Unit contribution margin.
2. Units that must be sold to break even.
3. Units that must be sold to earn an operating income of $500,000.

• Complete Dillon Corp.’s flexible budget for 75,000 units using the information listed below:

	25,000 Units	50,000 Units	75,000 Units
Sales	$375,000	$750,000
Cost of Goods Sold	$250,000	$500,000
Gross Profit on Sales	$125,000	$250,000
Operating expenses ($10,000 of it is fixed)	$35,000	$60,000
Operating Income	$90,000	$190,000
Income Taxes (30% of operating income)	$27,000	$57,000
Net Income	$63,000	$133,000

Assume that cost of goods sold and any variable operating expenses vary directly with sales and that income taxes remain constant at 30%.

• Del Sol Healthcare is considering two capital investment proposals. The information for both projects is listed below:

	Proposal #1	Proposal #2
Cost of the investment	$250,000	$300,000
Estimated salvage value	$25,000	$30,000
Average estimated net income	$50,000	$60,000

Calculate the return on average investment for both proposals and discuss which one would be the best option for investment.

 

Looking for a Similar Assignment? Order now and Get 10% Discount! Use Coupon Code "Newclient"