Innovative Management Accounting Tools

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Finance

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Table of Contents
1..................................................................................................................................................3
a).............................................................................................................................................3
b)............................................................................................................................................3
c).............................................................................................................................................3
d)............................................................................................................................................4
e).............................................................................................................................................4
f).............................................................................................................................................5
Question 2..................................................................................................................................5
a) & b)....................................................................................................................................5
Question 3..................................................................................................................................6
a).............................................................................................................................................6
References..................................................................................................................................8
Appendix....................................................................................................................................9

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1.
a)
The borrowing is made in the company and for that, there is the installment that is paid
amounting to $15897. The calculation for the same is made and that is presented below:
a) calculation of the amount of
borrowing
Particulars Amount
Installment amount 15897
Interest rate 0.5
Period 60
The present value of
borrowings
822281.24
The total amount of the borrowing which is made by the company is for $822281.24 which is
paid in installments in the coming five years.
b)
The current sale of the company is identified at $2234.1 which is increasing in a continuous
manner every year. By considering the increment the sale which will be available after five
years is shown hereunder:
b) Calculation of annual
revenue in five years
Particulars Amount
Annual revenue 2234.1
Annual growth rate 8.10%
Time period 5
Future value
multiplier
1.476
Sales in 5 years 3297.85