An Orcharder Spends $100,000 to Plant Pomegranate Bushes

question 122

Multiple Choice

An orcharder spends $100,000 to plant pomegranate bushes.It will take four years for the bushes to provide a usable crop.He estimates that every year for 20 years after that he will receive a crop worth $10,000 per year.If the discount rate is 8%,what is the net present value (NPV) of this investment?

• A)-$27,834
• B)-$12,897
• C)$108
• D)$3,268

Apply accounting principles to handle returns and early payment discounts in credit sales.

Comprehend the entries associated with discounts in a perpetual inventory system.

Learn how freight costs are accounted for in transactions and how they affect Inventory accounts.

Recognize the impact of sales discounts on cash collections and how they are recorded.

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Definitions:

McDonaldization

A term used to describe the increasing rationalization of the workplace and society, following principles of fast-food restaurants such as efficiency, calculability, predictability, and control.

American Lifestyles

A term encompassing the behaviors, customs, and practices commonly observed among individuals living in the United States, reflecting diverse cultural backgrounds.

Fast-Food Industry

A sector of the food service industry that specializes in food that can be prepared and served quickly.

Out-group

A social group to which an individual does not identify or belong, often viewed as distinct or oppositional to one's in-group.