The Jonsons Have Accumulated the Nest Egg of $30,000 That

question 124

Multiple Choice

The Jonsons have accumulated the nest egg of $30,000 that they indent to use as a down payment towards the purchase of a new house. Because their present gross income has placed them in a relative high tax bracket, they have decided to invest a minimum of $2,600/month monthly payments ( to take the advantages of the tax deduction) towards the purchase of their house. However, because of other defalt obligation their monthly payment should be exceed $4,000. If local morgage rates are 4% compounded monthly for a conventional 30-years morgage, how would this affect the price range of houses that the Jonsons should be consider? Round your intermediate calculations to two decimal places and the final answer to nearest integer. ​

• A) The range of the homes they should consider is approximately $573,816 to $867,263.
• B) The range of the homes they should consider is approximately $573,671 to $866,917 .
• C) The range of the homes they should consider is approximately $574,017 to $867,062 .
• D) The range of the homes they should consider is approximately $574,599 to $867,845.
• E) The range of the homes they should consider is approximately $575,609 to $868,855 .

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Definitions:

Realized Gross Profit

The gross profit that is actually earned and recognized on sales transactions, after the cost of goods sold has been deducted.

Cash Collections

The process of gathering and managing the cash from sales, financing, or other sources of revenue for a business.

Revenue Recognition

The accounting standard that identifies the exact circumstances where revenue is considered or documented.

Percentage of Completion

Percentage of completion is an accounting method used to recognize revenue and expenses of long-term projects proportionally to the work completed.