Year CustomerRetention ($) 0 Profit per Annual Customer Annual 1 50 2 70 Cumulative Discounted Accounts Discount Discount Cash Flow ($)0 ProbabilityRemainingRate 90% 87% 100 90 78.3 0.1 0.1 Factor 0.91 0.83

Survey of Accounting (Accounting I)
8th Edition
ISBN:9781305961883
Author:Carl Warren
Publisher:Carl Warren
Chapter9: Metric-analysis Of Financial Statements
Section: Chapter Questions
Problem 8CDQ
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The following table shows CLV for A company. What is the CLV of the first year (please round it up)?
Profit per Annual Customer Annual
Year CustomerRetention Accounts Discount Discount
($) Probability RemainingRate
0
1 50
2 70
3
↑
75
41
42
43
44
45
90%
87%
85%
100
90
78.3
66.5
0.1
0.1
Cumulative Discounted
Cash Flow
($)0
0.1
Factor
0.91
0.83
0.75
Transcribed Image Text:The following table shows CLV for A company. What is the CLV of the first year (please round it up)? Profit per Annual Customer Annual Year CustomerRetention Accounts Discount Discount ($) Probability RemainingRate 0 1 50 2 70 3 ↑ 75 41 42 43 44 45 90% 87% 85% 100 90 78.3 66.5 0.1 0.1 Cumulative Discounted Cash Flow ($)0 0.1 Factor 0.91 0.83 0.75
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