Answer:
Credit to Work in process of $67,000
Explanation:
Preparation of the ournal entries to record the transactions
Since we were told Zea Inc. transferred the amount of $67,000 from Work in Process to Finished Goods this means the transaction will be recorded as:
Dr Finished Goods 67,000
Cr Work in Process 67,000
Since we were told that Zea Inc. transferred recorded a Cost of Goods Sold for the amount of $73,000 this means that the transaction will be recorded as:
Dr Cost of Goods Sold 73,000
Cr Finished Goods 73,000
Hyperion Manufacturing is expected to pay a dividend of $2.25 per share at the end of the year. The stock sells for $75 per share, and its required rate of return is 12%. The dividend is expected to grow at some constant rate, g, forever. What is the equilibrium expected growth rate
Answer:
The equilibrium expected growth rate is 9%
Explanation:
Stock Price = Expected Dividend next year / (Required Return - Growth rate)
75 = 2.25/( 12% - growth rate)
75 * ( 12% - growth rate) = 2.25
75 * ( 0.12 - growth rate) = 2.25
9 - 75 * Growth rate = 2.25
9 - 2.25 = 75 * growth rate
6.75 = 75 * growth rate
Growth rate = 6.75 /75
Growth rate = 0.09
Growth rate = 9%
A company's days' cash on hand is computed by dividing: Group of answer choices cash and short-term investments by daily cash operating expenses. cash by total cash operating expenses. cash, short-term investments, and accounts receivable by daily cash operating expenses. average cash over the period by daily cash operating expenses.
Answer:
The answer is A. cash and short-term investments by daily cash operating expenses
Explanation:
This is calculated as follows:
cash and short-term investments(cash equivalents) ÷ daily cash operating expenses.
Cash equivalents are very short-term securities. They are very liquid and can be converted to cash very quickly. Examples are bank accounts short-term securities like treasury bills.
Days cash on hand is the number of days that a firm can afford to pay its operating expenses, given the amount of cash available.
Job 590 has a total cost of $ 29 comma 200. It has been charged manufacturing overhead costs of $ 7 comma 000. The rate is 75% of direct labor. What was the amount of direct materials charged to the job?
Answer:
Direct material= $12,867
Explanation:
Giving the following information:
Job 590:
Total cost= $29,200
Manufacturing overhead= $7,000
The rate is 75% of direct labor.
First, we need to calculate the direct labor cost:
Direct labor= allocated overhead/0.75
Direct labor= 7,000/0.75= $9,333
Now, we can calculate the direct material cost:
Total cost= direct material + direct labor + allocated overhead
29,200= direct material + 9,333 + 7,000
direct material= $12,867
Assume that today is December 31, 2019, and that the following information applies to Abner Airlines: After-tax operating income [EBIT(1 - T)] for 2020 is expected to be $700 million. The depreciation expense for 2020 is expected to be $150 million. The capital expenditures for 2020 are expected to be $375 million. No change is expected in net operating working capital. The free cash flow is expected to grow at a constant rate of 7% per year. The required return on equity is 13%. The WACC is 11%. The firm has $199 million of non-operating assets. The market value of the company's debt is $3.534 billion. 120 million shares of stock are outstanding. Using the corporate valuation model approach, what should be the company's stock price today
Answer:
The company's stock price today should be $71.17 per share.
Explanation:
The corporate valuation model approach can be used to estimate this by using the following steps:
Step 1: Calculation of the free cash flow
Free cash flow is the cash a firm generates after accounting for capital expenditure. This can be estimated using the following formula:
Free Cash Flow (FCF) = After-tax operating income + Depreciation expenses - Capital expenditure
For this question, we therefore have:
Free Cash Flow (FCF) = $700 + $150 - $375 = $475 million
Step 2: Calculation of Value of operations (Vo)
Vo = FCF / (WACC - FCF growth rate) = 475 / (11% - 7%) = $11,875 million
Step 3: Calculation of the Firm value
Firm value = Vo + Non-operating assets = $11,875 + $199 = $12,074 million
Step 4: Calculation of value of equity
Value of equity = Firm value - Debt = $12,074 - $3,534 = $8,540 million
Note: The correct amount of debt is $3,534 not $3.540 as mistakenly given, may be due to typographical error, in the question.
Step 5: Calculation of stock price per share today
Stock price per share = Value of equity / Number of shares outstanding = $8,540 / 120 = $71.17 per share
Therefore, the company's stock price today should be $71.17 per share.
Suppose that Antonio, an economist from an AM talk radio program, and Caroline, an economist from a school of industrial relations, are arguing over government intervention. The following dialogue shows an excerpt from their debate:
Caroline: The usefulness of government intervention in the economy is a long-standing issue that economists continue to debate.
Antonio: I feel that government involvement in the economy should be reduced because government programs cause more harm than good.
Caroline: While I do agree that government programs can be inefficient, I really think they are necessary to help the less fortunate.
1. The disagreement between these economists is most likely due to
a. differences in values
b. differences in scientific judgement
c.differences in perception verse reality.
2. Despite their differences, with which proposition are two economists chosen at random most likely to agree?
a. Lawyers make up an excessive percentage of elected officials.
b. Minimum wage laws do more to harm low-skilled workers than help them.
c. Tariffs and import quotas generally reduce economic welfare.
Answer:
1) Option A. differences in values
2) Option C. Tariffs and import quotas generally reduce economic welfare
Explanation:
1) Difference in values which can also be called value conflicts are due to variations in belief systems. I.e. when the belief systems of two groups do not allign. While Antonio believes that government programmes should be reduced because they cause more harm than good, Caroline is of the opinion that despite the inefficiency of government programmes, they are still necessary for the less fortunate. This disagreement is as a result of value conflict.
2) Both economists agree on the inefficiency of government programmes. The focal point of Caroline's argument is that government's intervention in the economy is needed for the less fortunate. Based on this premise, two economies chosen at random will most likely agree to the proposition that tariffs and import quotas generally reduce economic welfare.
Milton Industries expects free cash flow of $5 million each year. Milton's corporate tax rate is 35%, and its unlevered cost of capital is 15%. The firm also has outstanding debt of $19.05 million, and it expects to maintain this level of debt permanently. What is the value of Milton Industries without leverage? What is the value of Milton Industries with leverage?
Answer:
1. $33.33 million
2. $40.00 million
Explanation:
The computation of the value of Milton Industries with leverage is shown below:-
Value of Milton Industries without leverage is
= Free cash flow ÷ unlevered cost of capital
= $5 million ÷ 0.15
= $33.33 million
Value of Milton Industries with leverage is
= Value of Milton Industries without leverage + Tax × Debt
= $33.33 million + 0.35 × $19.05 million
= $40.00 million
Therefore we have applied the above formula.
Mayan Company had net income of $132,000. The company had 89,000 shares of common stock issued. The company had 9,000 shares of treasury stock. The company declared a $27,000 dividend on its preferred stock. There were no other stock transactions. What is the company's Earnings Per Share
Answer:
The company's Earnings Per Share is $1.18
Explanation:
Earnings per share = Earnings Attributable to Holders of Common Stock / Weighted Average Number of Common Stock Holders
= ($132,000 - $27,000) / 89,000
= $1.179775 or $1.18
" Frequently, beer manufacturers run television ads showing attractive, young people having fun and, of course, drinking their beer. These ads are designed primarily to create: "
Answer: To create interest in the youths that it's actually for them mostly.
Explanation:
The way an advert is carried out or planned describes who they are communicating to. The content of the advert targets about 80% of it's market by the content it uses when carrying out the advert. When as advert uses young people frequently, it is primarily targeting the young people to build interest in it's product. So the content of an advert describes the market it wants to sell to.
If beer companies makes use of young people for their adverts then it is known that they simply want more patronize and interest from those young people.
There are two goods that you can spend your income on; good X and good Y. The price of good X is Px and the price of good Y is Py. The level of income is N$1800 and tour utility function is
Answer:
N$1800 = PxX ≤ PyY
Explanation:
Utility is the sanctification a consumer services from consuming a good or a service.
An utility function measures the preferences of a consumer over a set of goods or services.
given income of $1,800 and prices px and py, a consumer has to choose a bundle of good that maximises utility given income as total expenditure cannot exceed income
Complete the following matrix to analyze the human factors that influence organizational change. Write 1 or 2 complete sentences to explain your rationale for each factor. An example has been provided. Human Factors That Influence Organizational Change Example: Resistance Influence on Organizational Change Example of Global Influence (if any) Example of National Influence (if any) Example: Causes delay in implementing change Example: Workers resist change to avoid outsourcing Example: Workers do not know position of the company in the marketplace Organizational Cause of Factor Example: Occurs because of how change is implemented by leadership 1. Loss of control 2. Uncertainty about future 3. Loss of face 4. Concern about competence 5. Fear of more work 6. Past resentments 7. Feeling threatened References
You deposit $2,400 into an account that pays 5% per year. Your plan is to withdraw this amount at the end of 5 years to use for a down payment on a new car. How much will you be able to withdraw at the end of 5 years? Do not round intermediate calculations. Round your answer to the nearest cent.
Answer:
3,063.08
Explanation:
To determine how much will you be able to withdraw at the end of 5 years, we have to calculate the present value of the amount paid.
The formula for calculating future value :
FV = P (1 + r)^n
FV = Future value
P = Present value
R = interest rate
N = number of years
$2,400 (1 + 0.05)^5 = 3,063.08
I hope my answer helps you
Drag each option to the correct location on the image. Match the pairs to their respective categories.
The correct answers are Pairs of Substitutes: tea- coffee, butter-margarine, petroleum-natural gas; Pairs of Complementary goods: printer-ink cartridge, pen-refill
Explanation:
In economics and related fields, substitutes are goods or products that are considered similar by customers and due to this, one product can replace the other. For example, butter and margarine are substitutes because they have similar properties and uses, which makes one product replace the other. This also occurs with tea and coffee, and petroleum and natural gas because one product can replace the other. Also, because of this, it is common customers buy only one of the products rather than both depending on preferences, price, availability, etc.
On the other hand, complementary goods are those that are used together, this often implies customers buy the two products and changes in one product affect the other. This occurs in the case of printer and ink cartridge because the products are used together and buying a printer often implies customers need to buy the cartridges. Similarly, pens and refills for pens are used and bought together, and one cannot replace the other.
MV Corporation has debt with market value of $ 95 million, common equity with a book value of $ 102 million, and preferred stock worth $ 20 million outstanding. Its common equity trades at $ 48 per share, and the firm has 5.6 million shares outstanding. What weights should MV Corporation use in its WACC? g
Answer:
Total market value $383.8 million
Debt is 24.75%
Preferred stock is 5.21%
Common equity is 70.03%
Explanation:
Calculation of the weights that MV Corporation should use in its WACC
Debt value : $95 million
Preferred stock value : $20 million
Market value of common equity:
$48 per share×5.6million shares= $268.8 million
Total market value of firm: $95 +20 +268.8 =$383.8 million
Weights for WACC calculation:
Debt =95/383.8
=24.75%
Preferred Stock =20/383.8
=5.21%
Common Equity =268.8/383.8
=70.03%
Therefore the total market value of the firm will be $383.8 million Debt is 24.85% of the total value, preferred stock is 5.21%, and common equity is 70.03%
If a firm with a positive net worth is operating its fixed assets at full capacity, if its dividend payout ratio is 100%, and if it wants to hold all financial ratios constant, then for any positive growth rate in sales, it will require external financing.
A. True
B. False
Answer:
TRUE
Explanation:
I got this question right on a test! Please make as brainiest!
A firm with total liabilities and owners’ equity of $100,000 and net sales of $50,000 would have a total asset turnover of
Answer:
= 50000 / 100000 * 100
= 0.50
Explanation:
On January 1, Parson Freight Company issues 8.0%, 10-year bonds with a par value of $3,200,000. The bonds pay interest semiannually. The market rate of interest is 9.0% and the bond selling price was $2,982,557. The bond issuance should be recorded as:
Answer:
Dr Cash 2,982,557
Dr Discount on bonds payable 217,443
Cr Bonds payable 3,200,000
Explanation:
Preparation for the bond issuance Journal entry
Since we were told that the Company has par value of the amount of $3,200,000 and the bond selling price of $2,982,557 which means the bond issuance should be recorded as:
Dr Cash 2,982,557
Dr Discount on bonds payable 217,443
(3,200,000-2,982,557)
Cr Bonds payable 3,200,000
Gross Profit MethodBased on the following data, estimate the cost of the ending merchandise inventory: Sales (net) $9,250,000 Estimated gross profit rate 36% Beginning merchandise inventory $180,000 Purchases (net) 5,945,000 Merchandise available for sale $6,125,000
Answer:
$205,000
Explanation:
The computation of the cost of the ending merchandise inventory is shown below:-
Cost of the ending merchandise inventory = Merchandise available for sale - (Net Sales - Gross profit)
= $6,125,000 - ($9,250,000 - $9,250,000 × 36%)
= $6,125,000 - ($9,250,000 - $3,330,000)
= $205,000
Therefore we applied the above formula so that the cost of ending merchandise inventory could come
Mr. and Mrs. Camarena's AGI (earned income) was $15,410. Their federal income tax withholding was $930. They had no itemized deductions and two dependent children, ages 18 and 19. If Mr. and Mrs. Camarena are entitled to a $4,732 earned income credit, compute their income tax refund. Assume the taxable year is 2019.
Answer: $5,662
Explanation:
In 2019, married couples filling jointly had a standard deduction of $24,400.
Mr. and Mrs. Camarena's AGI of $15,410 is below this and so they will not be taxed as all income below $24,400 for them is not Taxable.
The income tax refund they gain will therefore be just the earned income credit as well as their federal income tax withholding.
= 4,732 + 930
= $5,662
Milar Corporation makes a product with the following standard costs:
Standard Quantity or Hours Standard Price or Rate
Direct materials 7.7 pounds $ 4 per pound
Direct labor 0.1 hours $ 20 per hour
Variable overhead 0.1 hours $ 4 per hour
In January the company produced 2,000 units using 16,060 pounds of the direct material and 210 direct labor-hours. During the month, the company purchased 16,900 pounds of the direct material at a cost of $65,910. The actual direct labor cost was $4,473 and the actual variable overhead cost was $756. The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased.
The materials price variance for January is:
a. $1,690 U
b. $1,540 F
c. $1,540 U
d. $1,690 F
Answer:
Direct material price variance= $1,690 favorable
Explanation:
Giving the following information:
Direct materials 7.7 pounds $ 4 per pound
During the month, the company purchased 16,900 pounds of the direct material at a cost of $65,910.
To calculate the direct material price variance, we need to use the following formula:
Direct material price variance= (standard price - actual price)*actual quantity
actual price= 65,910/16,900= $3.9
Direct material price variance= (4 - 3.9)*16,900
Direct material price variance= $1,690 favorable
High fixed costs and low variable costs are typical of which approach? product process mass customization repetitive product and mass customization
Answer:
Product and mass customization.
Explanation:
In Financial accounting, fixed cost can be defined as predetermined expenses in a business that remain constant for a specific period of time regardless of the quantity of production or level of outputs. Some examples of fixed costs in business are loan payments, employee salary, depreciation, rent, insurance, lease, utilities etc.
On the other hand, variable costs can be defined as expenses that are not constant and as such usually change directly and are proportional to various changes in business activities. Some examples of variable costs are taxes, direct labor, sales commissions, raw materials, operational expenses etc.
High fixed costs and low variable costs are typical of product and mass customization.
Hence, the high fixed costs are usually a determinant for pricing a product that aren't produced in mass because to break even, businesses would need to rake in more revenues to meet the the increasing (high) fixed costs.
However, when this products are manufactured in mass, this would help to cut or lower down the total cost of production.
The Freeman Manufacturing Company is considering a new investment. Financial projections for the investment are tabulated below. The corporate tax rate is 40 percent. Assume all sales revenue is received in cash, all operating costs and income taxes are paid in cash, and all cash flows occur at the end of the year. All net working capital is recovered at the end of the project.
Year 0 Year 1 Year 2 Year 3 Year 4
Investment $37,000
Sales revenue $19,000 $19,500 $20,000 $17,000
Operating costs 4,000 4,100 4,200 3,400
Depreciation 9,250 9,250 9,250 9,250
Net working capital spending 430 480 530 430 ?
Required:
a. Compute the incremental net income of the investment for each year.
b. Compute the incremental cash flows of the investment for each year.
Answer:
a.
Year 0 = $0
Year 1 = $5,750
Year 2 = $6,150
Year 3 = $6,550
Year 4 = $4,350
b.
Year 0 = ($37,000)
Year 1 = $14,570
Year 2 = $14,920
Year 3 = $15,270
Year 4 = $15,040
Explanation:
a. Computation of the incremental net income of the investment for each year.
Year 0 Year 1 Year 2 Year 3 Year 4
Sales revenue $19,000 $19,500 $20,000 $17,000
Less Operating costs $4,000 $4,100 $4,200 $3,400
Less Depreciation $9,250 $9,250 $9,250 $9,250
Net Income $0 $5,750 $6,150 $6,550 $4,350
b. Computation of the incremental cash flows of the investment for each year.
Year 0 Year 1 Year 2 Year 3 Year 4
Investment ($37,000)
Sales revenue $19,000 $19,500 $20,000 $17,000
Operating costs ($4,000) ($4,100) ($4,200) ($3,400)
Net working capital ($430) ($480) ($530) ($430)
Recovery $1,870
Cash flow ($37,000) $14,570 $14,920 $15,270 $15,040
Specialty Auto Racing Inc. retails racing products for BMWs, Porsches, and Ferraris. The following accounts and their balances appear in the ledger of Specialty Auto Racing on July 31, the end of the current year:
Common Stock, $10 par $440,000
Paid-In Capital from Sale of Treasury Stock-Common 33,200
Paid-In Capital in Excess of Par-Common Stock 132,000
Paid-In Capital in Excess of Par-Preferred Stock 61,200
Preferred 4% Stock, $50 par 1,020,000
Retained Earnings 2,057,400
Treasury Stock-Common 38,500
Fifty thousand shares of preferred and 200,000 shares of common stock are authorized. There are 3,500 shares of common stock held as treasury stock.
Required:
Prepare the Stockholders' Equity section of the balance sheet as of July 31, the end of the current year.
Answer:
Specialty Auto Racing Inc.Stockholders' Equity section of the balance sheet as at July 31:
Authorized Share Capital:
Common Stock, 200,000 $10 par
Preferred 4% Stock, 50,000 $50 par
Common Stock, Issued share capital, $10 par $440,000
Paid-In Capital in Excess of Par-Common
Stock (132,000 + 33,200) 165,200
Treasury Stock-Common, 3,500 shares (38,500)
Preferred 4% Stock, $50 par 1,020,000
Paid-In Capital in Excess of Par-Preferred Stock 61,200
Retained Earnings 2,057,400
Total Equity $3,705,300
Explanation:
The Stockholders equity section of the balance reports the Preferred stock, common stock, additional paid‐in‐capital, retained earnings, and treasury stock. It also discloses information regarding the par value, authorized shares, issued shares, and outstanding shares for each type of stock.
The Paid-in Capital from sale of Treasury stock- common of $33,200 is added to the Paid-in Capital in Excess of Par- Common Stock as there is no separate account for it.
A support level is the price range at which a technical analyst would expect the Multiple Choice demand for a stock to decrease substantially. price of a stock to fall. supply of a stock to increase dramatically. supply of a stock to decrease substantially. demand for a stock to increase substantially.
Answer:
The answer is D. demand for a stock to increase substantially.
Explanation:
The point where technical analysts expect a substantial increase in the demand for a stock to occur is called a support level.
Most stock prices remain stable and fluctuate up and down. The lower limit to these fluctuations is called a support level - the price range where a stock appears cheap, making its demand to increase substantially.
Trade adjustment assistance:_________.a. provides financial assistance to all unemployed workers in the United Statesb. guarantees jobs for all workers displaced by imports or plant relocations abroadc. provides assisntace to about 20 percent of unemployed U.S. workers each yeard. provides cash assistance for workers displaced by imports or plant relocations abroad
Answer:
The correct answer is the option B: guarantees jobs for all workers displaced by imports or plant relocations.
Explanation:
To begin with, the name of "Trade Adjustment Assistance" or TAA refers to a federal program from the United States that establish that its government must act in the situations necessary in order to reduce the damage cause by imports that are felt by certain sectors of the U. S. economy. Moreover, this program's structure features four components and one of them is the program for workers in which is established that the TAA provides a variety of reemployment services to those workers who were displaced or lost their jobs due to the increase of the imports or the relocation of their work plants.
Assume that both firm A and firm B formally agree to each put up $10 million to form firm C. The operations of firm C are restricted to conducting research and development activities for the benefit of firms A and B. Firm C is a _____ of firms A and B.
Answer: a. joint venture.
Explanation:
A Joint Venture refers to when 2 or more entities come together and put up resources necessary to accomplish a certain task or venture that will be beneficial to all of them.
For example, BMW and Toyota jointly started research into utilizing hydrogen fuels and Google cooperated with NASA to create Google Earth.
Firm C is a Joint venture between Firms A and B.
A company is considering investing in a new machine that requires a cash payment of $47907 today. The machine will generate annual cash flows of $19946 for the next three years. What is thw internal rate of return if the company buys this machine
Answer:
12%
Explanation:
Calculation for the internal rate of return if the company buys this machine
Using this formula
IRR = Initial investment/Annual Cash flow
Where,
Initial investment =$47,907
Annual Cash flow =$19,946
Let plug in the formula
IRR= $47,907/$19,946
=2.402
Using PV factor table = 2.402
IRR = 12%
Therefore internal rate of return if the company buys this machine will be 12%
Knowledge Check 01 On March 1, a designer received a check for $7,500 from a customer for services to be provided after the customer chooses a color scheme for the first floor of her house. On July 31, the designer completed the design work for this customer. Prepare the July 31 journal entry by selecting the account names from the drop-down menus and entering the dollar amounts in the debit or credit columns.
Answer:
The Designer Journal Entry
Date General Journal Debit Credit
July 31 Unearned Revenue $7,500
Design Services Revenue $7,500
A publisher faces the following demand schedule for the next novel from one of its popular authors:
Price Quantity Demanded
(Dollars) (Copies)
100 0
90 100,000
80 200,000
70 300,000
60 400,000
50 500,000
40 600,000
30 700,000
20 800,000
10 900,000
0 1,000,000
The author is paid $2 million to write the novel, and the marginal cost of publishing the novel is a constant $10 per copy.
Complete the second, fourth, and fifth columns of the following table by computing total revenue, total cost, and profit at each quantity.
Quantity Total Revenue Marginal Revenue Total Cost Profit
(Novels) (Dollars) (Dollars) (Dollars) (Dollars)
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
1,000,000
Answer and Explanation:
The completion of the second, fourth, and fifth columns of the given table is to be shown in the attachment below:
As we know that
Profit = Total revenue - total cost
Total revenue is the revenue earned by the company by multiplying the price with the quantity demanded
While the total cost is
= Fixed cost + variable cost
The marginal revenue comes from
= Change in total revenue ÷ change in quantity
We simply use these formulas in the spreadsheet below.
The following attachment should be used to demonstrate how the second, fourth, and fifth columns of the provided table have been completed:
As we are aware of
Total revenue - total costs = profit.
Total revenue is the amount of money the business brings in by multiplying the price by the quantity of customers.
While the overall expense is
= Variable cost + fixed cost
The source of the marginal revenue is
= Change in quantity x Change in total revenue
These formulas are merely used in the spreadsheet that follows.
The table is completed and explained in the attachments.
Learn more about marginal revenue here
https://brainly.com/question/34532204
#SPJ6
A 22-year, semiannual coupon bond sells for $1,066.57. The bond has a par value of $1,000 and a yield to maturity of 6.78 percent. What is the bond's coupon rate
Answer:
The answer is 7.37%
Explanation:
Solution
Given that
Bond per value = future value =$1000
The current price = $1,066.57
Time = 22 years * 2
=44 semi-annual periods
The year of maturity = 6.78%/2 = 3.39%
Thus
The coupon rate is computed by first calculating the amount of coupon payment.
So
By using a financial calculator, the coupon payment is calculated below:
FV= 1,000
PV= -1,066.57
n= 44
I/Y= 3.39
Now we press the PMT and CPT keys (function) to compute the payment (coupon)
What was obtained is 36.83 (value)
Thus
The annual coupon rate is: given as:
= $36.83*2/ $1,000
= $73.66/ $1,000
= 0.0737*1,00
=7.366% or 7.37%
Therefore 7.37% is the bond's coupon rate.
You want to have $13,000 in 9 years for a dream vacation. If you can earn an interest rate of .4 percent per month, how much will you have to deposit today?
Answer:
PV= $8,447
Explanation:
Giving the following information:
Future value= $13,000
Number of months= 9*12= 108
Interest rate= 0.4/100= 0.004 compounded montlhy
To calculate the initial investment required, we need to use the following formula:
PV= FV/(1+i)^n
PV= 13,000/(1.004^108)
PV= $8,447