1. Which of the following statements regarding annuities is FALSE?
A. Most car loans, mortgages, and some bonds are annuities
B. PV of an annuity= C X 1/r (1- (1/ (1+r)^N)
C. An annuity is a stream of N equal cash flows paid at regular intervals.
D. The difference between an annuity and a perpetunity is that a perpetuity ends after some fixed number of payments.
2. Fitness Company reports the following data for 2009, its first year of operations:
What are the total manufacturing costs to be accounted for?
$300,000
$190,000
$160,000
$570,000