FIN 419 Week 3 – Individual Problems and Learning Team Paper
Preview of Individual Answers(2 versions)
VERSION 1: 6 PAGES
Chapter 2: Problem 2.2
|Account name||Statement||Type of account|
|Common Stock (at par)||BS||SE|
|Cost of goods sold||IS||E|
|Paid-in capital in excess of par||BS||SE|
|Preferred stock dividends||IS||E|
Chapter 4: Problem 4.23
- How large a fund will you need when you retire in 20 years to provide the 30-year, $20,000 retirement annuity?
A fund of $173,880 will be required to retire in twenty years to offer the 30-year, $20,000 retirement annuity. Computed as follows:
Gitman (2006), states, present value (annuity):????=???? (????A ?, ?)
VERSION 2: 5 PAGES
Chapter 4: Problem 4-23 – Personal Finance Problem
Funding your retirement – You plan to retire in exactly 20 years. Your goal is to create a fund that will allow you to receive $20,000 at the end of each year for the 30 years between retirement and death (a psychic told you would die exactly 30 years after you retire). You know that you will be able to earn 11% per year during the 30-year retirement period.
a. How large a fund will you need when you retire in 20 years to provide the 30-year, $20,000 retirement annuity?
$173,880 will be required to retire in 20 years to provide the 30-year, $20,000 retirement annuity. Calculated as follows:
PVA = PMT x (PVIFA11%, 30)
PVA = $20,000 x (8.694)
PVA = $173,880
- How much will you need today as a single amount to provide the fund calculated in part “a” if you earn only 9% per year during the 20 years preceding retirement? $30,950.64 would be needed today to provide $173,880 assuming only 9% is earned per year during the 20 years preceding retirement.
According to Gitman (2009), present value (single amount): = (, )
PV = FV x (PVIF9%,20)
PV = $173,880 x (0.178)
Preview of Learning Team Essay (8 Pages/ 1726 words)
Wal-Mart Financial Outcome
Wal-Mart Stores, Inc. presently serves its members and clients more than 200-million times a week, in 8,445 retail places in 15 different countries. Presently Wal-Mart operates all over the United States of America in different sectors such as super centers, neighborhood markets, discount stores, as well as www.walmart.com. Wal-Mart was established in 1962 by Sam Walton, and its head office is in the United States of America. Wal-Mart operates in the retail sector and provides items at affordable prices through its discount super stores as well as neighborhood markets. Wal-Mart’s net sales for the 2010 fiscal year were roughly $405 billion. The overseas section of this organization will incorporate a lot of types of restaurants, supercenters, discount stores, and also retail stores (Wal-Mart, 2010).
On March 4, 2010, in Bentonville, Arkansas, Wal-Mart Stores Inc. Board of Directors gave their consent for a $1.21 for each share yearly dividend. For the financial year 2010’s dividend of $1.09 for each share dividend this will offer an 11% growth equaling a $1.21 for each share. Wal-Mart’s present financial year, that concludes on January 31, 2011, there will be four identical payouts on the yearly dividend share of $1.21 equaling for the sum of $0.3025 for each share. The expected dates for distribution of the payouts will be the 5th of April, 2010; 1st of June, 2010; the 7th of September, 2010; and the 3rd of January of 2011. Wal-Mart’s Chief Executive and President Mike Duke said, “With our free cash flows, Wal-Mart has the capacity to grow around the world and make strategic acquisitions and fund returns to shareholders through dividends and share repurchases” (Wal-Mart, 2010).