The future worth
= -500*(F/P,5%,3)+250*(F/A,5%,3)
= -500*1.157625+250*3.1525
= -578.8125+788.125
= 210
Option(B)
Consider a project that costs $500 now and is expected to generate $250 in net revenues...
Consider the following projects with life 8 years, Project First cost MARR=8% B C D $800 $600 500 Annual Benefit $120 $97 122 $500 0 Salvage Value $500 The B/C ratio of project B is most nearly less than 1 2.3 1.4 1.5 1.3 No correct answer Next Consider the following projects with life 8 years, Project First cost MARR=8% B C D $800 $600 500 Annual Benefit $120 $97 122 $500 0 Salvage Value $500 The B/C ratio of...
A project is expected to generate annual revenues of $127,300, with variable costs of $78,400, and fixed costs of $18,900. The annual depreciation is $4,450 and the tax rate is 35 percent. What is the annual operating cash flow?
A project your firm is considering for implementation has these estimated costs and revenues: an investment cost of $57,673, maintenance costs that start at $5,000 at end-of-year (FOY) one and increase by $1,000 for each of the next four years, and then remain constant for the following five years; savings of $23,331 per year (EOY 1-10); and finally a resale value of $29,564 at EOY 10. If the project has a 10-year life and the firm's MARR is 10% per...
Consider a project that will generate revenues at the ned of the first and second years. Initial costs and expenses are $3000. In addition, the projects cost of capital is 7%. You are given the following information. Scenario 1 2 3 4 First Year Revenues $1100 $1500 $1800 $1200 Second Year Revenues $2900 $2500 $2200 $2800 Determine the projects net present value of the worst scenario.
A project is expected to generate annual revenues of $119,300, with variable costs of $75,400, and fixed costs of $15,900. The annual depreciation is $3,950 and the tax rate is 34 percent. What is the annual operating cash flow? Hint: Revenue - FC - VC - Depr. = EBIT. Taxes = EBIT x tax rate. OCF = EBIT + Depreciation - Taxes (same as chapter 2). a. $61,143 b. $28,000 c. $19,823 d. $31,950 e. $45,243 THANKS IN ADVANCE!
A project is expected to generate annual revenues of $128,100, with variable costs of $78,700, and fixed costs of $19,200. The annual depreciation is $4,500 and the tax rate is 40 percent. What is the annual operating cash flow? 8 Ο Multiple Choice Ο $34700 Ο $51,200 Ο S19,920 Ο $30,200 Ο $70,400
A five-year project is expected to generate annual revenues of $ 159,000, variable costs of $72,500, and fixed costs of $15,000. The annual depreciation is $19,500 and the tax rate is 21 percent. What is the annual operating cash flow?
1) A five-year project is expected to generate annual revenues of $159,000, variable costs of $72,500, and fixed costs of $15,000. The annual depreciation is $19,500 and the tax rate is 21 percent. What is the annual operating cash flow? 2) Your local athletic center is planning a $1.2 million expansion to its current facility. This cost will be depreciated on a straight-line basis over a 20-year period. The expanded area is expected to generate $745,000 in additional annual sales....
A certain machine costs $30,000, Expected revenues are $2500 per quarter for the next 6 years. The quarterly operating cost is $500. The machine can be sold for $1000 at the end of the 6 years. If the interest is 8% compounded quarterly, determine the equivalent quarterly worth and EAW.
An investment project requires a net investment of $200 million. The project is expected to generate annual net cash flows of $25 million for the next 15 years with a one-time end of project cash flow of $3 million. The firm's cost of capital is 14 percent and marginal tax rate is 40 percent. a) Evaluate the project using the NPV method and state whether or not the project should be accepted. b) Evaluate the project using the IRR method...