A modestly wealthy individual has left an estate to his son

Assignment Help Business Management

Reference no: EM13788814

ESTATE LIQUIDATION

A modestly wealthy individual has left an estate to his son. The value of some assets are estimated to increase over time while others are estimated to decrease. Estimates of the values (in $1000) of the assets contained based on the year they are liquidated are shown in Table 1.

Table 1. Estimated liquidation values of assets based on year of liquidation Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7

Home $275 $290 $310 $330 $350 $370 $385
Jewelry $36 $38 $40 $42 $44 $46 $48
Mercedes $80 $75 $70 $65 $60 $55 $50
Rare Gold Coins $115 $118 $121 $123 $124 $125 $126
Stocks $425 $450 $470 $490 $505 $520 $530
Bonds $85 $86 $87 $88 $89 $90 $92

The son's financial advisor has been tasked to develop a schedule for liquidating the assets.

The son's three requirements are

1. Each asset class (e.g., Home, Jewelry, etc.) must be liquidated in a single year, i.e., no partial liquidations.

2. Schedule the liquidation in a manner that provides at least $125,000 each year, cumulatively. That is, liquidate at least $125,000 in the first year, a total of at least $250,000 in the first two years, a total of at least $375,000 in the first three years and so on.

3. Maximize the total liquidated over the seven years. Create a Solver-based spreadsheet model to determine when to liquidate each of the six asset classes and solve the model.

Reference no: EM13788814

Questions Cloud

Prepare a project report about ali baba : Prepare a project report about Ali Baba.

Adopted the reasonably foreseeable user rule : What standard of care applies to Able & Henderson's accounting work for Hambones, Inc.? Does Able & Henderson face any negligence liability to First State Bank or Sauce Supply in a state that has adopted the Ultramares rule? In a state that has adopt..

Define demography or difference between population dynamics : Define demography and explain the difference between population dynamics

Issues cause between less-developed countries : What kinds of issues could this technology cause between less-developed countries?

A modestly wealthy individual has left an estate to his son : ESTATE LIQUIDATION A modestly wealthy individual has left an estate to his son. The value of some assets are estimated to increase over time while others are estimated to decrease. Estimates of the values (in $1000) of the assets contained based on t..

Write the journal entry-acquired land in exchange : On May 12th, a company acquired land in exchange for 1,000 shares of $20 par common stock with a current fair-market price of $73. Journalize this transaction. On April 30th, 2010, Arlington Company issued $1,500,000 of 10-year, 8% bonds (face value ..

Making an image of a computer hard drive : You are located at an arson scene and have started making an image of a computer hard drive. The fire re-kindles and the firefighters are having problems extinguishing the fire

Analyze a specific business problem related to communication : analyze a specific business problem related to communication in business and propose research-based recommendations to solve it.

History of capital punishment in the united states : A brief history of capital punishment in the United States. Include case law. An explanation of the constitutional ban on "cruel and unusual punishment," including the four primary dimensions as interpreted by the Court

User Account

All Pages