Question

Was the value of this contract equal to $125 million cash in hand in 2013? A. No, because $125 million is the sum of payments over the years, not the present value of the payments. B. Yes, the tax benefits of the charity payment allow the $125 million to be considered present value. C. Yes, because $125 million is the total amount that will be paid out. D. No, because the payments are made at the end instead of the beginning of each year.

Name: was the value of this contract equal to 125 million cash in hand in 2013 a no because 125 million is the sum of payments over the years not the present value of the payments b yes the tax be 90648
Uploaded: 2022-12-23T18:36:22-08:00
Duration: 2 min 23 s
Channel: Sanchit Jain
Description: was the value of this contract equal to 125 million cash in hand in 2013 a no because 125 million is the sum of payments over the years not the present value of the payments b yes the tax be 90648

          Was the value of this contract equal to $125 million cash in hand in 2013?
A.
No, because $125 million is the sum of payments over the years, not the present value of the payments.
B.
Yes, the tax benefits of the charity payment allow the $125 million to be considered present value.
C.
Yes, because $125 million is the total amount that will be paid out.
D.
No, because the payments are made at the end instead of the beginning of each year.

Added by Whitney R.

Horngren’s Cost Accounting

Srikant M. Datar, Madhav V. Rajan 16th Edition

Instant Answer

Solved by Expert Sanchit Jain

12/23/2022

Step 1

The question refers to a contract valued at $125 million, which implies that this amount is likely to be paid out over a period of time rather than as a lump sum. Show more…

Show all steps

Thanks for your feedback!

Was the value of this contract equal to $125 million cash in hand in 2013? A. No, because $125 million is the sum of payments over the years, not the present value of the payments. B. Yes, the tax benefits of the charity payment allow the $125 million to be considered present value. C. Yes, because $125 million is the total amount that will be paid out. D. No, because the payments are made at the end instead of the beginning of each year.