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1 If you deposit $400 in a bank account that earns 6 percent per year, how much total interest will you have earned after the third year? (Do not round intermediate calculations
1
If you deposit $400 in a bank account that earns 6 percent per year, how much total interest will you have earned after the third year? (Do not round intermediate calculations. Round your answer to 2 decimal places. (e.g., 32.16)) Total interest
2
If Bud's Sporting Goods store has total fixed costs of $25,200 and the contribution margin per unit is $120, the break-even point in units is 232 True False
Expert Solution
1
PV = 400, r =6% , n = 3 years
we have to find out future value of lump sum (PV)
FV = PV*(1+r)^n
FV = 400*(1+0.06)^3 = 400*1.191016 = 476.41 [rounded to 2 decimals]
Total interest earned after 3 years = 476.41 - 400 = 76.41
Answer : 76.41
2
Total value available for fixed expenses= contribution margin* sales=120*232=$27840
Since the amount is more than foxed cost this is not break even point. Actual break even point is 25200/120=210 units
Hence statement is false
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