Which of the following statements is CORRECT? Statement 1. Time lines can be constructed in situations where some of the cash flows occur annually but others occur quarterly. Statement 2. Time lines cannot be constructed in situations where some of the cash flows occur annually but others occur quarterly. Statement 3. Time lines can be constructed for annuities where the payments occur at either the beginning or the end of the periods

Which of the following statements is CORRECT? Statement 1. Time lines can be constructed in situations where some of the cash flows occur annually but others occur quarterly. Statement 2. Time lines cannot be constructed in situations where some of the cash flows occur annually but others occur quarterly. Statement 3. Time lines can be constructed for annuities where the payments occur at either the beginning or the end of the periods

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter12: Current Liabilities

Section: Chapter Questions

Problem 13MC: Which of the following is not a characteristic of a short-term note payable? A. Payment is due in...

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Which of the following statements is CORRECT? Some of the cash flows shown on a time line can be in the form of annuity payments, but none can be uneven amounts. A time line is not meaningful unless all cash flows occur annually. Time lines are not useful for visualizing complex problems prior to doing actual calculations. Time lines cannot be constructed in situations where some of the cash flows occur annually but others occur quarterly. Time lines can be constructed for annuities where the payments occur at either the beginning or the end of the periods.
Which of the following is not true regarding an annuity due? Select the correct response: It is a series of equal cash flows. Payments are made at the start of each period. It is also known as deferred annuity Cash flows occurs for a specific time.
Which of the following characteristics is a necessary feature for pricing a set of cash flows as an ordinary annuity? Group of answer choices The period of time between each cash flow must not vary. More than one of the other options are correct. The cash flows must not be a fixed, regular amount. The cash flows must occur on a yearly basis.
Accounting Ordinary annuities assume that the first payment is made at the end of each year. In a transaction, who is better off in this arrangement, the payer or the receiver? Why?
An annuity due is one in which _____. a. payments or receipts occur at the beginning of each period b. payments or receipts occur at the end of each period c. cash flows occur continuously d. payments or receipts occur forever
In solving measurement problems involving the use of annuities, which of these four required conditions are not accurate? Periodic cash flows are equal in amount. Time periods between the cash flows are the same length. Interest rate is constant for each time period. Interest is compounded at the beginning of each time period.
There are three categories of cash flows: single cash flows, also referred to as “lump sums,” a stream of unequal cash flows, and annuities. Based on your understanding of annuities, answer the following questions. 1. Which of the following statements about annuities are true? Check all that apply. An annuity due is an annuity that makes a payment at the beginning of each period for a certain time period. An annuity is a series of equal payments made at fixed intervals for a specified number of periods. An annuity due earns more interest than an ordinary annuity of equal time. Ordinary annuities make fixed payments at the beginning of each period for a certain time period. 2. Which of the following is an example of an annuity? A job contract that pays a regular monthly salary for three years A job contract that pays an hourly wage based on the work done on a particular day 3. Eleanor loves shopping for clothes, but considering the state of the economy, she has decided to…
1. a) the amt of interest pd in cash every payment period, 1. b) the amt of amorization to be recorded at each interest payment date.(use the straight -line method
5) One standard assumption for annuities and gradients is A) each payment occurs at the beginning of the period. B) annuities and gradients coincide with the beginning of sequential periods. C) annuities and gradients coincide with the end of preceding periods. D) payment period and compounding period differ. E) payment period and compounding period are the same. and why? Solve it early and give explanation.
A fixed stream of cash flows occurring at the beginning of each period for a fixed period of time is known as: Select one: a. Ordinary annuity b. Constant annuity c. Annuity due d. Financial annuity
6. Trade receivables are classified as current assets when they are reasonably expected to be collected a. Within one year b. Within the normal operating cycle c. Within one year or within the normal operating cycle whichever is shorter d. Within one year or within the normal operating cycle whichever is longer 7. Nontrade receivables are classified as current assets only if they are reasonably expected to be realized in cash a. Within one year or normal operating cycle, whichever is shorter. b. Within the normal operating cycle c. Within one year or the normal operating cycle, whichever is longer d. Within one year, the length of the operating cycle notwithstanding 8. Which is true concerning the balance sheet presentation of receivables? a. Trade receivables and nontrade receivables are shown separately. b. Nontrade receivables are presented as noncurrent assets. c. Trade accounts receivable and trade notes should be presented separately. d. Trade receivables and nontrade…
Compute the present values of the following annuities first assuming that payments are made on the last day of the period and then assuming payments are made on the first day of the period: (Do not round intermediate calculations. Round your answers to 2 decimal places. (e.g., 32.16)) Present Value Present Value Interest Rate (Payment made on last day of period) (Payment made on first day of period) Payment Years (Annual) 748.09 8. 14 % 8,668.26 14 7 21,022.93 24 70,412.54 32