Alex has been offered an engineering job with a large company that has offices in Makati and Laguna. The salary is P720,000 peryear at either location. Makati's tax burden is 20% and Laguna's is 15%. If Alex accepts the position in Laguna and stay with thecompany for 5 years, what is the FW (future worth) of the tax savings? Your personal MARR is 10% per year. (Hint: Use 5% = 20% -15%)(A) P219,783.60(B) P4,395,672.00C) P2,729,366.47D) P136,468.32

Future worth refers to the value of a current asset at some future date based on the interest…

Answered: Alex has been offered an engineering…

Excel Applications for Accounting Principles

4th Edition

ISBN:9781111581565

Author:Gaylord N. Smith

Publisher:Gaylord N. Smith

Chapter27: Time Value Of Money (compound)

Section: Chapter Questions

Problem 6E

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Let’s see after your graduation, you will be offered an engineering job with a large company that has offices in Davao City and Cagayan del Oro City. The salary is P35,000 per month at either location. But for the sake of computation, Davao City income tax is 6% and Cagayan del Oro is 3.07%. If you accept the position in Cagayan del Oro and stay with the company for 10 years, what is the FW of the tax savings? (Your personal MARR is 10% per year.)
Suppose you return to college and earn an MBA, after which you get a middle-management position with General Mills, the firm that makes Lucky Charms and other breakfast cereals. If the tax rates are the same as in 2018 and your starting salary is $90,000, how much will General Mills pay on your behalf in federal social insurance taxes? between $7,000 and $8,000 less than $7,000 O between $9,000 and $10,000 between $8,000 and $9,000 more than $10,000
After graduation, you have been offered an engineering job with a large company that has offices in Tennessee and Pennsylvania. The salary is $55,000 per year at either location. Tennessee’s tax burden (state and local taxes) is 6% and Pennsylvania’s is 3.07%. If you accept the position in Pennsylvania and stay with the company for 10 years, what is the FW of the tax savings? Your personal MARR is 10% per year.
After graduation, Charmaine have been offered an engineering job with a large company that has offices in Manila and Palawan. The salary is P350,000 per year at either location. Manila’s tax burden (state and local taxes) is 6.5% and Palawan is 4.07%. If you accept the position in Manila and stay with the company for 12 years, what is the FW of the tax savings? Your personal MARR is 10% per year.
Ruth has asked for help in determining whether she should receive her $32,500 bonus check in the current year or next year. In the current year, her marginal tax rate is 24% and she anticipates she will be in the 32% marginal tax bracket next year. What advice can you give Ruth? Net revenue from bonus $ Current year Ruth should choose to receive her bonus in the ✓year. Next year
Taylor and Charlie currently live in New Orleans. Taylor is currently making $60,000 per year, andCharlie is currently making $40,000 per year. Let’s assume that both live for four periods, and thediscount rate is 13%.(a) Calculate Taylor and Charlie’s present value if they stay in New Orleans.(b) Now, let’s assume both have been offered a new job in Denver. Taylor’s new offer is $75,000a year, and Charlie’s new offer is $80,000 per year. Taylor has estimated a moving cost of$60,000, and Charlie has estimated a moving cost of $100,000. Calculate their new presentvalues if they were to move to Denver.(c) Would Taylor move if single? Would Charlie move if single? Would they move as a marriedcouple? Explain your reasoning.(d) Who is the tied stayer? Who is the tied mover? Explain your reasoning.(e) Now, let’s assume both Taylor and Charlie live for infinite periods. Calculate their presentvalues in each city with this new information, but do not include moving costs this time.(f) Suppose…
Anita and Jim are considering a home equity loan to build a nice deck and patio in their back yard. They want to borrow $35,000 and are quoted an APR of 10%. If their marginal tax bracket is 24%, how much money can they save in taxes each year if capitalize on the tax-deductibility of interest paid on the home equity loan?
On the road to financial independence, Toby is planning to save and invest regularly. Toby decides to save $64 at the end of each month and invest the money into a financial instrument that gives him 6.3 percent per annum compounded monthly (after tax). How much will Toby receive from his investment (in $ after 10 years? Using information from previous question: If you expect to get $500,000 after 10 years investment, how much money ($) you have to set aside every end of the month?
A.)Your client has recently had a baby girl. He wants to set aside his annual bonus at the end of each year to pay her college costs in 18 years. He expects his bonus to be $5,000 per year and thinks he can earn 6% per year. How much will he have saved at the end of 18 years? B.) How much will he have saved at the end of 18 years if his bonus is received at the beginning of each year?
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Laura wants to buy a delivery truck. The truck costs $76,000 , and will allow her to increase her after tax profits by $14,000 per year for the next 10 years. She will borrow 82% of the cost of the truck for 10 years, at an interest rate of 6%. Laura’s unlevered cost of capital is 17% and her tax rate is 21%. The loan includes a $2,000 application fee. What is the NPV of buying the truck on these terms? Please use the APV method.
Laura wants to buy a delivery truck. The truck costs $117,000 , and will allow her to increase her after tax profits by $18,000 per year for the next 10 years. She will borrow 72% of the cost of the truck for 10 years, at an interest rate of 7%. Laura's unlevered cost of capital is 8% and her tax rate is 20%. The loan includes a S2,000 application fee. What is the NPV of buying the truck on these terms?

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