Bob and Dave Each Started with $130,020

question 1

Essay

Bob and Dave each started with $130,020.They retired,and both took out $6,500 of their money at the end of each year and spent it.Bob had 32 percent declines in his assets in year 2 whereas Dave's occurred in year 3.They both had a 7 percent increase per year in their assets in the remaining years.Assuming no tax impact,what sums did each have at the end of each year for each of the four years following retirement?

---

Definitions:

Variance Report

A document that compares actual financial performance to planned or budgeted performance, highlighting variances between these figures.

Machine Hours

A measure of the operating time of machines or equipment, typically used in allocating manufacturing costs.

Fixed Overhead Rate

A predetermined rate used to allocate fixed overhead costs to units of output, based on a standard level of activity.

Gross Profit

Sales minus the cost of goods sold.