Which of the Following Transactions Would Require the Use of the Present

question 14

Multiple Choice

Which of the following transactions would require the use of the present value of an annuity due concept in order to calculate the present value of an asset acquired or liability assumed?

• A)A rental agreement is entered into with the initial payment due immediately.
• B)A rental agreement is entered into with the initial payment due one month from the signing of the agreement.
• C)A note payable is obtained from a bank requiring monthly payments for six years, beginning at the end of the current month.
• D)A machine is acquired by paying $20, 000 cash and agreeing to pay equal annual amounts of $10, 000 each at the end of the next three years.

---

Definitions:

Objective Lens

The part of a microscope closest to the object being observed, which focuses light or electrons to create an enlarged image.

Ocular Lenses

The lenses closest to the eyes in a microscope, binoculars, or other optical instruments, enhancing the user's ability to see small details.

Compound Microscope

An optical instrument consisting of a series of lenses that magnify objects in steps; used for detailed observation of microorganisms and cells.

Substage Illuminator

A light source located beneath the stage of a microscope, used to illuminate the specimen from below.