PFIN 7:STUDENT EDITION-TEXT
7th Edition
ISBN: 9780357033616
Author: Billingsley
Publisher: CENGAGE L
expand_more
expand_more
format_list_bulleted
Concept explainers
Question
Chapter 10, Problem 3FPE
Summary Introduction
To identify: A plan for Mr.M in deciding how much insurance to buy and help them find a policy
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Susan and Jose rent an apartment and have been saving for a house. They now have $10,000 in the bank. Susan owes $4,000 on a low-interest credit card; Jose owes $4,500 on his car. Susan wants to pay the credit card and car off to eliminate the debt. Jose wants to keep the cash in the bank and continue saving for the house. What are the pros and cons of each one’s argument? Please be detailed and concise. Feel free to use a chart or table to represent your argument.
Steve and Bob are students at Berkeley College. They share an apartment that is owned by Bob. Bob is considering subscribing
to an Internet provider that has the following packages available:
Steve spends most of his time on the Internet ("everything can be found online now"). Bob prefers to spend his time talking on
the phone rather than using the Internet ("going online is a waste of time"). They agree that the purchase of the $75 total
package is a "win-win" situation.
Package
Per Month
Requirements
A. Internet access
2$
60
1.
Allocate the $75 between Steve and Bob using (a) the stand-alone cost-allocation method, (b) the incremental
cost-allocation method, and (c) the Shapley value method.
Which method would you recommend they use and why?
B. Phone services
20
2.
C. Internet access
phone services
75
Requirement 1. Allocate the $75 between Steve and Bob using (a) the stand-alone cost-allocation method, (b) the incremental cost-allocation method, and (c) the Shapley value method.…
Imagine you’re renting an apartment with a friend after high school. Your friend wants to get satellite TV but can’t because they have bad credit due to a history of late payments. They ask if you’ll sign up for it and assure you they’ll take care of the payments. How would you respond?
Chapter 10 Solutions
PFIN 7:STUDENT EDITION-TEXT
Ch. 10 - Prob. 1LOCh. 10 - Identify the types of coverage provided by...Ch. 10 - Prob. 3LOCh. 10 - Prob. 4LOCh. 10 - Prob. 5LOCh. 10 - Choose a property and liability insurance agent...Ch. 10 - Prob. 1FPECh. 10 - Last year, Thea and Rory Brown bought a home with...Ch. 10 - Prob. 3FPECh. 10 - Prob. 4FPE
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.Similar questions
- Anthony and Amy expect to settle down and purchase a home now that Anthony has a stable job with a solid long- term growth company. They are meeting with their loan officer to determine which mortgage would best suit their needs. Amy is a stay-at-home mom raising their two school-age children. She sometimes provides child care services for her immediate family members. Neither Anthony nor Amy have served in the military, Anthony and Amy want to secure a mortgage that offers the lowest monthly payment with a fixed interest rate. Based on this information, which mortgage would be the most appropriate choice?\\n\\nA)\\nAdjustable-rate mortgage\\nB)\\n30-year conventional mortgage\\nC)\\n15-year conventional mortgage\\nD)\\nVA mortgagearrow_forwardUpon Jena’s retirement, the couple plans to relocate their home close to the beach. For this purpose, they intend to buy a house near the beach and a rental property (to fund their retirement). They do not have the funds to make these purchases. Please explain to the couple the downsizing retirement strategy most appropriate to their circumstance.arrow_forwardTitan completes a $300,000 life insurance application form with his insurance agent Esther. Esther informs him that the insurer will request an attending physicians' statement (APS). Titan inquires about the purpose of an APS. Which of the following is Titan's CORRECT response? Select one correct answer from the list 1. An APS is needed to obtain a summary of Titan's medical history. 2 An APS is needed to obtain a summary of Titan's family medical history. 3. 4. An APS is needed to obtain more information about Titan's lifestyle. An APS is needed to find out why Titan's driver's license was suspended. 000 0arrow_forward
- Steven is a mortgage broker who receives referrals from a real estate agent on a regular basis. The real estate agent has told the Steven that she will be sending him several clients who may have trouble being approved because of their income. Steven is concerned that if he cannot get these clients approved the real estate agent will find another mortgage agent who can. Given this scenario which of the following statements is correct? Select one: a. The mortgage agent should consider each applicant on their own merits and do the ones he can ethically do b. The mortgage agent must not do these deals as they are likely fraudulent c. The mortgage agent must refer this situation to his principal broker since he knows they are fraudulent d. The mortgage agent should tell the real estate agent that he cannot do these deals because he would have to commit fraudarrow_forwardEvan and David are students at Berkeley College. They share an apartment that is owned by David. David is considering subscribing to an Internet provider that has the following packages available: Evan spends most of his time on the Internet ("everything can be found online now"). David prefers to spend his time talking on the phone rather than using the Internet ("going online is a waste of time"). They agree that the purchase of the $90 total package is a "win-win" situation. Package Per Month Requirements A. Internet access 80 B. Phone services 20 1. Allocate the $90 between Evan and David using (a) the stand-alone cost-allocation method, (b) the incremental cost-allocation method, and (c) the Shapley value method. 2. Which method would you recommend they use and why? C. Internet access + phone services 90 Requirement 1. Allocate the $90 between Evan and David using (a) the stand-alone cost-allocation method, (b) the incremental cost-allocation method, and (c) the Shapley value…arrow_forwardYou have a friend, Icahn Betitall, who just started a small business. He ispaying a hefty premium for insurance. Icahn’s insurance agent told himthat he is insuring against the risk of loss on fire, theft, liability, and businessinterruption. Icahn also has policies for life, health, and automobiles. Icahnis planning a trip to Las Vegas. He plans to contact his agent and obtain apolicy on the risk of losing his money at the blackjack table.a. What should you tell Icahn about being able to purchase such a policy?b. What are several methods that Icahn can choose to manage his risk exposurein Las Vegas?arrow_forward
- François, an insurance agent with Safe Life Insurance Co., meets with Thomas and Annie Fortin to assess their life insurance needs. The Fortins are a single-income family with two children: a two-year- old and a four-year-old. Annie, the sole income earner, is an anesthetist with a hectic and unpredictable work schedule at the hospital Thomas is the primary caregiver and stay-at-home parent. He does not earn an income. Annie's income is sufficient to cover the family's savings and expenses. During the meeting, François gathers relevant information to assess the loss of income that would result from Annie's death. Should François also assess the financial impact that would result from Thomas's death? Select one correct answer from the list 1. Yes, Thomas's sense of self-worth would suffer if he was not included in the analysis Yes, Thomas' death may have a financial impact on Annie's ability to keep earning a sufficient income. No, Annie's income already covers the family's savings and…arrow_forwardSuppose you have $5,000 as a gift from your parents just after they kicked you out of the house. You have a car, your great grandfather's rare world War 1 commemorative badge collection and you quickly found a place to rent for a while. You work in a factory that has a history of workplace injury and you work near the conveyor belts and other gaint machines. You are single and live by yourself. Based on this information, what types of insurance would you need to purchase? List each type you would need and explain 1-2 sentences why.arrow_forwardSusan and Gary are considering offering a doggy day-care service. After some research, they found several pet day-care facilities in their area, but they were expensive! Further, the facilities were sterile and didn't provide a "homey" or fun environment for pets. Susan and Gary felt they could easily fix these shortcomings. Susan's home would be the location for their business, since it already has a fenced-in yard and is located two blocks from a dog park. Estimated costs for building an outdoor shelter, plus other licensing and business start-up costs, are as follows. Shelter (depreciated over 7 years) Licensing and other annual costs Hourly wage for hired labor; planned for only 190 hours per year Variable costs for food Estimated volume of dogs per day (open for business 5 days per week, 50 weeks per year; average length of stay 8 hours per day) (b) Target cost per dog hour Assume that the company employs a target costing approach and that the going rate for doggy day care is $10…arrow_forward
- Jennifer and David are considering offering a doggy day-care service. After some research, they found several pet day-care facilities in their area, but they were expensive! Further, the facilities were sterile and didn't provide a "homey" or fun environment for pets. Jennifer and David felt they could easily fix these shortcomings. Jennifer's home would be the location for their business, since it already has a fenced-in yard and is located two blocks from a dog park. Estimated costs for building an outdoor shelter, plus other licensing and business start-up costs, are as follows. Shelter (depreciated over 7 years) Licensing and other annual costs Hourly wage for hired labor; planned for only 210 hours per year Variable costs for food Estimated volume of dogs per day (open for business 5 days per week, 50 weeks per year; average length of stay 8 hours per day) $600 per year $700 per year $14 per hour $15 per day per dog 26 per dayarrow_forwardJeff and his girlfriend Amy want to go on a shopping spree for her birthday, however, neither one of them had any money for this adventure. They both agreed that Jeff would go over to his father’s condo and take his credit card to fund this birthday celebration. Jeff went over to his father’s while his father was out, entered, and took one of his credit cards. Once they obtained the card the first stop on this journey was to a local jewelry store where they bought a 15-carat diamond ring for her worth $5,000 and a diamond-encrusted watch for him valued at $2,500 using the credit card. They then went to the coach store where they purchased a handbag and matching wallet for Amy for $4,500 using the credit card. They then had lunch where they spent $60 again paying for it with the credit card. They then went to a local liquor store where Jeff purchased two bottles of wine valued at $75 each. He paid for it with a personal check with the knowledge that he did not have sufficient funds in…arrow_forwardSuppose that you decide to start a landscape business. You use an old pickup truck that you've fully paid for. You store the truck and other equipment in your parents' barn, and you store trees and shrubs on their land. Your parents will not charge you for the use of these facilities for the first two years, but beginning in the third year they will charge a reasonable rent. Your mother helps you by answering phone calls and providing customers with information. She doesn't charge you for this service, but she plans on doing it for only your first two years in business. Instructions Answer ONE of the following sets of questions: 1. In pricing your services, should you include charges for the truck, the barn, the land, and your mother's services when calculating your product cost? Provide your reasoning. 2. In recording costs in the books, should you include charges for the truck, the barn, the land, and/or your mother's services? Describe the accounting rules that support your answer.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
