Long-term investment decision, payback method bill williams has the opportunity to invest in project a that costs $9,000 today and promises to pay annual end-of- year payments of $2,200, $2,500, $2,500, $2,000, and $1,800 over the next 5 years. or, bill can invest $9,000 in project b that promises to pay annual end-of-year pay- ments of $1,500, $1,500, $1,500, $3,500, and $4,000 over the next 5 years. a. how long will it take for bill to recoup his initial investment in project a? b. how long will it take for bill to recoup his initial investment in project b? c. using the payback period, which project should bill choose? d. do you see any problems with his choice?

You are chairman of the board of a successful technology firm. there is a nominal federal corporate tax rate of 35 percent, yet the effective tax rate of the typical corporation is about 12.6%. your firm has been clever with use of transfer pricing and keeping money abroad and has barely paid any taxes over the last 5 years; during this same time period, profits were $28 billion. one member of the board feels that it is un-american to use various accounting strategies in order to avoid paying taxes. others feel that these are legal loopholes and corporations have a fiduciary responsibility to minimize taxes. one board member quoted what the ceo of exxon once said: “i’m not a u.s. company and i don’t make decisions based on what’s good for the u.s.” what are the alternatives? what are your recommendations? why do you recommend this course of action?

Winners of the georgia lotto drawing are given the choice of receiving the winning amount divided equally over 2121 years or as a lump-sum cash option amount. the cash option amount is determined by discounting the annual winning payment at 88% over 2121 years. this week the lottery is worth $1616 million to a single winner. what would the cash option payout be?

Which one of the following statements is correct? process costing systems use periodic inventory systems. process costing systems assign costs to departments or processes for a time period. companies that produce many different products or services are more likely to use process costing systems. production is continuous when a job-order costing is used to ensure that adequate quantities are on hand.