Homework Answers
![Present Value Annuity Tables Formula: PV = [1-1/(1+i)]/i n/ i 1% 2% 3% 0.9901 0.9804 0.9709 1.9704 1.9416 1.9135 2.9410 2.88](http://img.homeworklib.com/questions/0f1e19e0-721a-11ea-8d2b-5bfd7933f470.png?x-oss-process=image/resize,w_560)
To solve this problem compute
Net Present Value, i.e. Present Value of Annual Inflow minus
Initial Outflow. The equipment yielding the higher NPV will be
selected.
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MC 2. Using an annual cash flow analysis Your Test Equipment Y may be replaced with...
8 pts Question 11 Consider the following two mutually exclusive alternatives: $ 20,000 Uniform amul benefit...
8 pts Question 11 Consider the following two mutually exclusive alternatives: $ 20,000 Uniform amul benefit Useful life in years Alternative B may be replaced with an identical item every 20 years at the same $28,000 cost and will have the same $2.750 uniform annual benefit. Ata 7% interest rate, use the annual cash flow analysis method to find which alternative should be selected. ཀྱིས 12pt Paragraph Consider the following two mutually exclusive alternatives: $ 20,000 2.000 $28.000 2.750 Uniform...
2. Consider the following two mutually exclusive alternatives: Cost, $ Uniform annual benefit, $ Useful life,...
2. Consider the following two mutually exclusive alternatives: Cost, $ Uniform annual benefit, $ Useful life, years 100,000 16,000 150,000 24,000 Using a 10% interest rate, and an annual cash flow analysis, determine which alternative should be selected. Draw the CFD.
Need cash flow diagram 04) Three mutually exclusive alternative are being considered Initial Cost Benefit at the end of the first Year Uniform Annual Benefits at end of subsequent years Useful Lif...
Need cash flow diagram
04) Three mutually exclusive alternative are being considered Initial Cost Benefit at the end of the first Year Uniform Annual Benefits at end of subsequent years Useful Life in years $500 $200 $100 $400 $200 $125 $300 $200 $100 At the end of its useful life, an alternative is not replaced. If MARR is 10%, which alternatives should be selected? a) Based on the payback period? b) Based on benefit-cost ratio analysis c) Benefit/Costs Analysis using...
6. A Texas corporation is considering the following two alternatives: Before Tax Cash Flow (thousands) Year Alternative...
6. A Texas corporation is considering the following two alternatives: Before Tax Cash Flow (thousands) Year Alternative 1 Alternative 2 10,000 20,000 0 1- 10 4,500 4,500 11-20 0 4,500 Both alternatives will be depreciated with 7 year MACRS depreciation. As Texas has no state income tax requirement, the combined income tax rate for the company is 21%. Neither alternative is replaced at the end of its useful life. If the corporation has a minimum attractive rate of return of...
1. (20 Points) (a) Choose the best machine based on annual cash flow analysis. The market...
1. (20 Points) (a) Choose the best machine based on annual cash flow analysis. The market interest rate is 26% and inflation is 5% Machine-X Machine-Y Initial Cost S6,000 $8,000 Annual Maintenance Cost SO $150 Salvage Value SO $1,000 Useful Life 5 years 12 years
NOTE: Annual cash net flow should be multiplied by PVF for annuity EXERCISE 13–7 Net Present...
NOTE: Annual cash net flow should be multiplied by PVF for
annuity
EXERCISE 13–7 Net Present Value Analysis of Two Alternatives Perit Industries has $100,000 to invest. The company is trying to decide between two alternative uses of the funds. The alternatives are: The working capital needed for project B will be released at the end of six years for investment elsewhere. Perit Industries' discount rate is 14%. Project A Project B Cost of equipment required ............. Working capital investment...
2. Solve the following problem using Ann Two pieces of construction equipment are being analyzed ual Cash Flow Analysis: (10) Year Alternative A Alternative B $200,000 $200,000 10,000 2 -20,000 3...
2. Solve the following problem using Ann Two pieces of construction equipment are being analyzed ual Cash Flow Analysis: (10) Year Alternative A Alternative B $200,000 $200,000 10,000 2 -20,000 3 15,000 30,000 30000 10,000 20,000 45,00030,000 40,00050,000 50,000 20,000 At 11% interest rate, which alternative should be selected?
2. Solve the following problem using Ann Two pieces of construction equipment are being analyzed ual Cash Flow Analysis: (10) Year Alternative A Alternative B $200,000 $200,000 10,000 2 -20,000 3...
Problem 2 of 4. 25 points) Cash flow diagrams required Use a 10-years analysis period and...
Problem 2 of 4. 25 points) Cash flow diagrams required Use a 10-years analysis period and Net present worth analysis with 8% interest rate First Cost Uniform annual beneft Useful life in years $12.000 $2.000 10 10500 $1.800 a) Draw cash flow diagrams b) Determine best aternative. Why? c) How much does the better choice saves?
4. You are to choose between two competing alternatives using Annual Cash Flow Analysis. Altemative A...
4. You are to choose between two competing alternatives using Annual Cash Flow Analysis. Altemative A has an expected life of ten (10) years. After making the appropriate calculations for Alternative A, it was found that EUAW- $4,450. Given below are the characteristics of Alternative B. Based on these characteristics, determine which option, trany, you should choose. MARR-10%. (S5233) Alternative B $75,000 3,000 each year S30,000 the first year, dropping by $2,000 each year after $10,000 Initial Cost O&M Costs...
Prepare a statement of Cash Flow for the current year using the indirect method Robust Robots,...
Prepare a statement of Cash Flow for the current year using
the indirect method
Robust Robots, Inc. Comparative Balance Sheet December 31, 2019 and 2018 2019 2018 Assets Current Assets: Cash Accounts Receivable, net Merchandise Inventory Supplies Prepaid Insurance Total Current Assets $ $ $ $ $ $ 65,000 150,000 135,000 9,700 30,000 389,700 $ $ $ $ $ $ 80,000 100,000 70,000 500 10,000 260,500 Property, Plant, and Equipment: Equipment Less: Accumulated Depreciation - Equipment Total Property, plant, and...
8 pts Question 11 Consider the following two mutually exclusive alternatives: $ 20,000 Uniform amul benefit Useful life in years Alternative B may be replaced with an identical item every 20 years at the same $28,000 cost and will have the same $2.750 uniform annual benefit. Ata 7% interest rate, use the annual cash flow analysis method to find which alternative should be selected. ཀྱིས 12pt Paragraph Consider the following two mutually exclusive alternatives: $ 20,000 2.000 $28.000 2.750 Uniform...
2. Consider the following two mutually exclusive alternatives: Cost, $ Uniform annual benefit, $ Useful life, years 100,000 16,000 150,000 24,000 Using a 10% interest rate, and an annual cash flow analysis, determine which alternative should be selected. Draw the CFD.
Need cash flow diagram
04) Three mutually exclusive alternative are being considered Initial Cost Benefit at the end of the first Year Uniform Annual Benefits at end of subsequent years Useful Life in years $500 $200 $100 $400 $200 $125 $300 $200 $100 At the end of its useful life, an alternative is not replaced. If MARR is 10%, which alternatives should be selected? a) Based on the payback period? b) Based on benefit-cost ratio analysis c) Benefit/Costs Analysis using...
6. A Texas corporation is considering the following two alternatives: Before Tax Cash Flow (thousands) Year Alternative 1 Alternative 2 10,000 20,000 0 1- 10 4,500 4,500 11-20 0 4,500 Both alternatives will be depreciated with 7 year MACRS depreciation. As Texas has no state income tax requirement, the combined income tax rate for the company is 21%. Neither alternative is replaced at the end of its useful life. If the corporation has a minimum attractive rate of return of...
1. (20 Points) (a) Choose the best machine based on annual cash flow analysis. The market interest rate is 26% and inflation is 5% Machine-X Machine-Y Initial Cost S6,000 $8,000 Annual Maintenance Cost SO $150 Salvage Value SO $1,000 Useful Life 5 years 12 years
NOTE: Annual cash net flow should be multiplied by PVF for
annuity
EXERCISE 13–7 Net Present Value Analysis of Two Alternatives Perit Industries has $100,000 to invest. The company is trying to decide between two alternative uses of the funds. The alternatives are: The working capital needed for project B will be released at the end of six years for investment elsewhere. Perit Industries' discount rate is 14%. Project A Project B Cost of equipment required ............. Working capital investment...
2. Solve the following problem using Ann Two pieces of construction equipment are being analyzed ual Cash Flow Analysis: (10) Year Alternative A Alternative B $200,000 $200,000 10,000 2 -20,000 3 15,000 30,000 30000 10,000 20,000 45,00030,000 40,00050,000 50,000 20,000 At 11% interest rate, which alternative should be selected?
2. Solve the following problem using Ann Two pieces of construction equipment are being analyzed ual Cash Flow Analysis: (10) Year Alternative A Alternative B $200,000 $200,000 10,000 2 -20,000 3...
Problem 2 of 4. 25 points) Cash flow diagrams required Use a 10-years analysis period and Net present worth analysis with 8% interest rate First Cost Uniform annual beneft Useful life in years $12.000 $2.000 10 10500 $1.800 a) Draw cash flow diagrams b) Determine best aternative. Why? c) How much does the better choice saves?
4. You are to choose between two competing alternatives using Annual Cash Flow Analysis. Altemative A has an expected life of ten (10) years. After making the appropriate calculations for Alternative A, it was found that EUAW- $4,450. Given below are the characteristics of Alternative B. Based on these characteristics, determine which option, trany, you should choose. MARR-10%. (S5233) Alternative B $75,000 3,000 each year S30,000 the first year, dropping by $2,000 each year after $10,000 Initial Cost O&M Costs...
Prepare a statement of Cash Flow for the current year using
the indirect method
Robust Robots, Inc. Comparative Balance Sheet December 31, 2019 and 2018 2019 2018 Assets Current Assets: Cash Accounts Receivable, net Merchandise Inventory Supplies Prepaid Insurance Total Current Assets $ $ $ $ $ $ 65,000 150,000 135,000 9,700 30,000 389,700 $ $ $ $ $ $ 80,000 100,000 70,000 500 10,000 260,500 Property, Plant, and Equipment: Equipment Less: Accumulated Depreciation - Equipment Total Property, plant, and...
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