FINANCIAL STATEMENTS Accrual-based approach – revenues are recorded at the point of sale and costs when they are incurred‚ not necessarily when a firm receives or pays out cash Cash flow approach – used by financial professionals to focus attention on current and prospective inflows and outflows of cash 1. Balance sheet a. Assets Cash and Cash Equivalents Marketable securities Accounts receivable Inventories Net property‚ plant and equipment Intangible assets b. Liabilities Accounts
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common uses for logs in the real world are calculating compound interest‚ calculating population growth or decay‚ and carbon dating. Using logs is a key component when solving for compound interest. Whenever you are calculating the interest on an investment that is compounded continuously‚ a natural exponential function is used. To solve for continuously compounded interest you use the formula A(t) = Pert‚ where P is the principal‚ r is the interest rate‚ and t is the number of years since the investment
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Chapter 6 The Time Value of Money-Annuities and Other Topics 6.1 Annuities 1) You wish to borrow $2‚000 to be repaid in 12 monthly installments of $189.12. The annual interest rate is: A) 24%. B) 8%. C) 18%. D) 12%. 2) If you have $20‚000 in an account earning 8% annually‚ what constant amount could you withdraw each year and have nothing remaining at the end of five years? A) $3‚525.62 B) $5‚008.76 C) $3‚408.88 D) $2‚465. 3) If you invest $750 every six months at 8% compounded semi-annually
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of time when compounded at a given interest rate. Present Value(PV):The value today of a future cash flow or series of cash flows. Compounding : The process of going to future values (FVs) from present values (PVs) is called compounding. Present Value of Multiple Uneven Cash Flow Investment made do not yield constant periodic cash flow Most cases firm receives stream of uneven cash flows Where Ct is Cash flow in period t‚ i is rate of interest n= number of years Example Consider
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from now‚ at which time it will be redeemed for $1‚000. What interest rate would you earn if you bought this bond at the offer price? a. 4.37% b. 4.86% c. 5.40% d. 6.00% e. 6.60% N 5 PV $747.25 PMT $0 FV $1‚000.00 I/YR 6.00% 4. You sold a car and accepted a note with the following cash flow stream as your payment. What was the effective price you received for the car assuming an interest rate of 6.0%? Years: 0 1 2 3 4 | | | | |
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$10‚000 invested now after five years if the annual interest rate is 8 percent. * * a. What would be the future value if the interest rate is a simple interest rate? * * * * * * b. What would be the future value if the interest rate is a compound interest rate? * 2. Find the present value of $7‚000 to be received one year from now assuming a 3 percent annual discount interest rate. Also calculate the present value if the $7‚000
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future. Interest - is the return you receive for investing your money. The interest rate is the basis for a test that any proposed investment must pass. Example: Putting $100 in the bank Earn 6% interest After 1 year $106 $100 $106 Future Values and compound rate Future Value - Amount to which an investment will grow after earning interest. Simple Interest - Interest earned only on the original investment. Compound Interest - Interest earned on interest. - The
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Glen Arnold‚ Corporate Financial Management‚ 5th Edition © Pearson Education Limited 2013 Slide 4.2 Simple Interest and Future Value • Simple interest A sum of £10 is deposited in a bank account that pays 12 per cent per annum. At the end of year 1 the investor has £11.20 in the account. F = P(1 + i) 11.20 = 10(1 + 0.12) where F = Future value‚ P = Present value‚ i = Interest rate. At the end of five years: F = P(1 + in) where n = number of years. 16 = 10(1 + 0.12 × 5) Glen Arnold
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Syntel Technical Interview Questions: 1.Difference between Virtual and Abstract Method ? 2.What is Runtime Polymorphism ? 3.What is Overiding ? 4.What is the use of a private constructor? 5.What design patterns you used in the project ? 6.What is an interface ? Is there any relation betweem interface and performance ? 7.what is an abstract class ? 8.What is the difference between DataSet and DataReader ? 9.What is CommandBuilder ? 10.What is the Difference between Application and Sesssion
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certain point of time in the future‚ assuming a certain interest rate. Time value of money can also be used to compute such useful information as car‚ mortgage and other loan payments. Another use of time value of money in accounting is reporting of certain long-term assets and liabilities. Time value of money is based on the principle of compound interest. Each time there is a compounding period the new principal is increased by the interest from the previous period. Converting Before Using
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