Using the Following Partial Table of Present Value of $1

question 62

Multiple Choice

Using the following partial table of present value of $1 at compound interest, the present value of $15,000 to be received 3 years hence with earnings at the rate of 6% a year is

• A)$12,600
• B)$11,880
• C)$13,350
• D)$11,265

---

Definitions:

Collection Policy

The procedures and guidelines used by a company to manage and collect accounts receivable.

Current Ratio

A liquidity ratio that measures a company's ability to pay short-term obligations or those due within one year, calculated as current assets divided by current liabilities.

Salaries Payable

An account representing the amounts owed to employees for work performed but not yet paid.

Price/Earnings Ratio

A valuation metric for a stock, calculated by dividing the market price per share by the earnings per share.