You have been asked to help your classmate who was just

Assignment Help Accounting Basics

Reference no: EM13574582

You have been asked to help your classmate, who was just offered a professional soccer contract, with selecting her choice of contract offers. The first offer pays her $1.5 million dollars as a signing bonus and $250,000 for the next three years. The second offer pays her $500,000 as a signing bonus and provides an additional $500,000 for the next four years. The current market rate for contracts of this type is 9%. Which contract is better ? By how much?

Note: to find the answer to this problem, compute the present value for each contract then find the dollar difference. Hint: find the pv factor and multiply by the future contract payments then add the signing bonus to find the present value of the contract.

Reference no: EM13574582

Questions Cloud

What decision would you recommend hint set up a payoff : a financial executive lives in ottawa but frequently must travel to toronto. she can go to toronto by car train or

The bank wants a 12 percent interest rate and requires five : loan amortization. a commercial bank is willing to make you a loan of 10000. the bank wants a 12 percent interest rate

Of course if the law is passed and the decision is to : the wilhelms cola company plans to market a new pineapple-flavoured cola this summer. the decision is whether to

The financial statements of the melton manufacturing : the financial statements of the melton manufacturing company reports net sales of 500000 and accounts receivable of

You have been asked to help your classmate who was just : you have been asked to help your classmate who was just offered a professional soccer contract with selecting her

Of course if the law is passed and the decision is to : q1. the wilhelms cola company plans to market a new pineapple-flavoured cola this summer. the decision is whether to

Rosen company receives a 3000 3-month 6 promissory note : rosen company receives a 3000 3-month 6 promissory note from bay company in settlement of an open accounts receivable.

If newfound produced net income of 225500 what was : newfound aerial photography corp had the following account balance changes at the end of the year. negative changes are

140 under the allowance method of accounting for bad debts : 140. under the allowance method of accounting for bad debts why must uncollectible accounts receivable be estimated at

User Account

All Pages