Answers to Assignment 4(1)

Answers to Assignment 4(1) - The University of Texas at...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
The University of Texas at Austin McCombs School of Business, Business Foundations Program ACC 310F: Foundations of Accounting Answers to Assignment 4 Part A 1. Welz Company is considering investing in an annuity contract that will return $25,000 annually at the end of each year for 25 years. What amount should Welz Company pay for the investment if it earns a 8% return? 266,875 2. You plan on buying a new home in four years and want to have a $15,000 down payment at that time. Your bank pays interest at a rate of 6 percent. How much should you deposit today to reach your goal for your house down payment? 11,880 3. A potential customer asked your lemonade company to help cater an upcoming event by providing beverages for 50 guests (2 cups per guest); the customer offers to pay you $30. You plan on using a “4, 2, 2” recipe which produces 12 cups per pitcher. If the catered event will not interfere with your regular lemonade business, what amount of net income would you expect from the event? 12.50
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This document was uploaded on 12/15/2011.

Page1 / 2

Answers to Assignment 4(1) - The University of Texas at...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online