You Are the Recipient of an Inheritance That Will Pay

question 68

Multiple Choice

You are the recipient of an inheritance that will pay you and your heirs $13,000 a year forever.What is this inheritance worth today at a discount rate of 5.85 percent?

• A)$222,222.22
• B)$239,250.00
• C)$211,953.94
• D)$241,141.41
• E)$236,004.98

---

Definitions:

Phantom Profits

Profits that are recorded on the books but do not result in an actual cash benefit, often due to accounting practices or non-cash expenses.

Paper

Paper refers to a thin material composed of processed cellulose fibers derived from wood, rags, or grasses, and used for writing, printing, or packaging.

Unit Price

The cost assigned to a single unit of a product or service, which helps consumers compare prices and make purchasing decisions.

LIFO Inventory Method

An inventory costing method that assumes the last items put into inventory are the first ones taken out, used in calculating cost of goods sold.