Assume bonds payable are amortized using the straight-line amortization method unless stated otherwise. Determining present value Your grandfather would like to share some of his fortune with you. He offers to give you money under one of the following scenarios (you get to choose): $8,750 per year at the end of each of the next six years $49,650 (lump sum) now $100,450 (lump sum) six years from now Requirements Calculate the present value of each scenario using a 6% discount rate. Which scenario yields the highest present value? Round to the nearest dollar. Would your preference change if you used a 12% discount rate?

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Fringe Benefit Tax

Fringe benefits are in addition to the compensation that companies give to their employees. It is an additional benefit above the stated salary. It helps to keep the employees of the firm motivated as sometimes the only salary is not enough to retain the quality employees of the firm. There are different types of fringe benefits. Fringe benefits are given in both private as well as public enterprises.