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problem1. Suppose a firm has an average inventory of $50,000, sales of $250,000, gross profit of $100,000, and net income of $25,000. The preferred formulation for inventory turnover results in inventory turnover of:

a. 1 time
b. 3 times
c. 4 times
d. 5.5 times

problem2.  Ed Sloan desires to withdraw $25,000 (comprising principal) from investment fund at the end of each year for 5 years. How should he find out his required initial investment at the starting of the first year when the fund earns 10% compounded annually?

a. $25,000 times the future value of 5-year, 10% ordinary annuity of 1.
b. $25,000 divided by the future value of 5-year, 10% ordinary annuity of 1.
c. $25,000 times the present value of 5-year, 10% ordinary annuity of 1.
d. $25,000 divided by the present value of 5-year,10% ordinary annuity of 1.

problem3. What amount will be in a bank account three years from now when $5,000 is invested each year for 4 years with the first investment to be made today?

a. ($5,000 x 1.260) + ($5,000 x 1.166) + ($5,000 x 1.080) + $5,000
b. $5,000 x 1.360 x 4
c. ($5,000 x 1.080) + ($5,000 x 1.166) + ($5,000 x 1.260) +
d. ($5,000 x 1.360) e. $5,000 x 1.080 x 4

Financial Accounting, Accounting

  • Category:- Financial Accounting
  • Reference No.:- M93929

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