To the People To the Government Benefits: $300,000 now Costs: $1.5 million now and $100,000 and $200,000 three per year thereafter Disbenefits: $40,000 per year years from now Savings: $70,000 per year
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From the following data, calculate the (a) conventional and (b) modified benefit/cost ratios using a discount rate of 6% per year and a very long (infinite) project life.
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- A company buys a piece of equipment for €2 million on January 1. The expected useful life is 6 years and the salvage value is estimated zero. The company intends to replace the equipment identically. The average expected price increase is 8% yearly. For this purpose, the company creates a special fund with annual equal payments at the end of each year during the lifetime. Cost of capital and earnings of the fund (i) is 10% per year. Compute the annual payment into the fund.A $110,000 payment is made on a long-term liability. Of this amount, $10,000 represents interest. Which of the following is true for the recording of this transaction? Reduce liabilities by $100,000 in the government-wide financial statements. Record a $110,000 expenditure in the fund financial statements. Reduce liabilities by $100,000 in the fund financial statements. Recognize $10,000 interest expense in the government-wide financial statements.The state government established a capital project fund in 2019 to build new highways. The fund is siupported by a 5 percent tax on disel fuel sales in the state. The tax is collected by private gas stations and remitted in the following month to the state. The following transactions occured during 2020: Debits: cash $8,550,000; Taxes receivable $2,700,000; Credits : Contracts Payble $1,950,000; fund balance $9,300,000 1. 42,100,000 of encumbrances outstanding at December 31, 20189 were re-established. 2. During the year, fuel taxes were remitted to the state totaling $23,600,000, including the amount due at the end of the previous year. In addition, $2,870,000 is expected to be remitted in January of next year for fuel sales in December 2020. 3. the state awarded new contracts for road construction totaling $23,650,000. 4. During the year, contractors submitted invoices for payment totaling $23,970,000. These were all under the terms of contracts (i.e., same $ amounts) issued by the…
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- Recent sales of some real estate and record profits make it possible for a manufacturer to set aside $600,000 in a fund to be used for modernization and remodeling. How much can be withdrawn from this fund at the beginning of each half-year for the next 5 years if the fund earns 7.1%, compounded semiannually?The officers and Board of Directors of the Philippine Institute of Civil Engineers desire to award a P3,000 scholarships annually to deserving Civil Engineering students for as long as its scholarship fund last. The fund was started September 1, 2007 by a donor in the amount of P18,000. The PICE invested this amount at that time at 8% per annum, and plans on adding P600 each year to the fund from its dues starting September 2008 for as long as awards are made. How to solve for how many years starting September1, 2008 can scholarship be awarded?The year-end pre-closing trial balance for the Chance County Woodland Park Capital Projects Fund is provided below. Debits Credits Cash $ 921,000 Grant Receivables 690,000 Investments 1,300,000 Contract Payable $ 1,493,000 Contract Payable – Retained Percentage 71,000 Encumbrances Outstanding 1,850,000 Revenues 797,000 Encumbrances 1,850,000 Construction Expenditures 4,600,000 Other Financing Sources – Proceeds of Bonds 5,150,000 $ 9,361,000 $ 9,361,000 Required Prepare the year-end statement of revenues, expenditures, and changes in fund balances for the capital projects fund.