What Is the Future Value of the Following Cash Flows

question 128

Multiple Choice

What is the future value of the following cash flows at the end of year 3 if the interest rate is 7.25% ? The cash flows occur at the end of each year.

• A)£8,758.04
• B)£8,806.39
• C)£10,073.99
• D)£10,314.00
• E)£10,804.36

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Definitions:

Cost Objects

Items or activities for which costs are measured and assigned, such as products, services, or projects.

Plantwide Overhead Rate

A single rate used to allocate manufacturing overhead costs uniformly across all products within a plant or facility.

Overhead Allocations

The process of distributing indirect costs across various products, services, or departments within a business.

Allocation Base

A criterion or standard used to distribute indirect costs to various cost objects, such as products, services, or departments.