Homework Answers
Present value of inflows=cash inflow*Present value of discounting factor(rate%,time period)
=200,000/1.16+225,000/1.16^2+275,000/1.16^3+200,000/1.16^4
=$626264.53
NPV=Present value of inflows-Present value of outflows
=626264.53-410,000
=$216265(Approx).
Add Answer to:
the
s company is planning on investing in a new project. this will
involve the purchase...
The Sisyphean Company is planning on investing in a new project.This will involve the purchase of...
The Sisyphean Company is planning on investing in a new project.This will involve the purchase of some new machinery costing $ 450 comma 000$450,000. The Sisyphean Company expects cash inflows from this project as detailed below: Year 1 Year 2 Year 3 Year 4 $ 200 comma 000$200,000 $ 225 comma 000$225,000 $ 275 comma 000$275,000 $ 200 comma 000$200,000 The appropriate discount rate for this project is 16%. The internal rate of return (IRR) for this project is closest...
A firm is considering investing in a project that requires an initial investment of $200,000 and...
A firm is considering investing in a project that requires an initial investment of $200,000 and is expected to produce cash inflows of $60,000, $80,000, and $100,000 in first, second, and third years. There will be no residual value. The firm applies a discount rate of 10%. Discount factors for Year 1, 2 and 3 are 0.909, 0.826, and 0.751 respectively. Required: i) Calculate the NPV of the project. ii) Explain the meaning of NPV and its advantages as an...
Capital Budgeting Analysis: The MCSL Corp. is planning a new investment project which is expected to...
Capital Budgeting Analysis: The MCSL Corp. is planning a new investment project which is expected to yield cash inflows of $180,000 per year in Years 1 through 3, $225,000 per year in Years 4 through 7, and $185,000 in Years 8 through 10. This investment will cost the company $880,000 today (initial outlay). We assume that the firm's cost of capital is 7.8%. (1) Draw a time line to show the cash flows of the project. 2) Compute the project’s...
Afirm is considering investing in a new project with an upfront cost of $300 million. The...
Afirm is considering investing in a new project with an upfront cost of $300 million. The project will generate an incremental free cash flow of $50 million in the first year and this cashflow is expected to grow at an annual rate of 4% forever. If the firm's WACC is 11% what is the value of this project? O A $450.0 million O B. $714.3 million OC. 5750.0 million OD. 5414.3 million Click to select your answer
Question Help Dartis Company is considering investing in a specialized equipment costing $690,000. The equipment has...
Question Help Dartis Company is considering investing in a specialized equipment costing $690,000. The equipment has a useful life of 6 years and a residual value of $69.000. Depreciation is calculated using the straight-line method. The expected net cash inflows from the investment are given below. Year 1 $207,000 153,000 167,000 100,000 53,000 $680,000 What is the accounting rate of return on the investment? O A. 3.42% OB. 1.55% OC. 3.8% OD. 3.11% Click to select your answer. Uamma Company...
ABC Company is considering whether a project requiring the purchase of new equipment worth investing. The...
ABC Company is considering whether a project requiring the purchase of new equipment worth investing. The firm spent $20,000 three months ago to conduct market study. The cost of a new machine is $160,000, and the firm has to spend additional $10,000 to get it shipped and installed. This project will increase annual revenues by $225,000 and annual costs by $45,000. If the firm undertakes this project, $50,000 in net working capital investment is required. What is the initial outlay...
Brooyklyn, Inc is investing $400,000 in a new project. The project is expected to generate the...
Brooyklyn, Inc is investing $400,000 in a new project. The project is expected to generate the following net annual cash flows over the next 4 years. Assume a cost of capital of 12%. Year Net Clash Flow 1 $150,000 2 $175,000 3 $200,000 4 $250,000 A. Calculate the project's conventional payback period? B. Calculate project's NPV? C. Calculate the project's PI?
0 The Sisyphoan Corporation is considering investing in a new cane manufacturing machine that has an...
0 The Sisyphoan Corporation is considering investing in a new cane manufacturing machine that has an estimated life of three years. The cost of the machine is $30,000 and the machine will be depreciated straight line over its three-year life to a residual value of $0. The cane manufacturing machine will result in sales of 2000 canes in year 1. Sales are estimated to grow by 9% per year each year through year 3. The price per cane that Sisyphean...
A company is contemplating investing in a new piece of manufacturing machinery. The amount to be...
A company is contemplating investing in a new piece of manufacturing machinery. The amount to be invested is $210,000. The present value of the future cash flows is $225,000. The company’s desired rate of return used in the present value calculations was 12%. Which of the following statements is true? Select one: a. The project should not be accepted because the net present value is negative. b. The internal rate of return on the project is less than 12%. c....
In May 2010, Blackwaler Spring Metal purchased a computanding forming machinery for $750,000. The company expects...
In May 2010, Blackwaler Spring Metal purchased a computanding forming machinery for $750,000. The company expects to use the machinery for 10 years (usetul sfe), at the end of which it will have a $ 200 000 salvad value. Using this information, answer questions (a) through (c) independently (a) If the company used the straight line depreciation method, how much depreciabon deduction for the machinery in 2011? O A. 560,000 OB. 555,000 OC. 565.000 OD. 550.000 double decining Moth b)...
A firm is considering investing in a project that requires an initial investment of $200,000 and is expected to produce cash inflows of $60,000, $80,000, and $100,000 in first, second, and third years. There will be no residual value. The firm applies a discount rate of 10%. Discount factors for Year 1, 2 and 3 are 0.909, 0.826, and 0.751 respectively. Required: i) Calculate the NPV of the project. ii) Explain the meaning of NPV and its advantages as an...
Afirm is considering investing in a new project with an upfront cost of $300 million. The project will generate an incremental free cash flow of $50 million in the first year and this cashflow is expected to grow at an annual rate of 4% forever. If the firm's WACC is 11% what is the value of this project? O A $450.0 million O B. $714.3 million OC. 5750.0 million OD. 5414.3 million Click to select your answer
Question Help Dartis Company is considering investing in a specialized equipment costing $690,000. The equipment has a useful life of 6 years and a residual value of $69.000. Depreciation is calculated using the straight-line method. The expected net cash inflows from the investment are given below. Year 1 $207,000 153,000 167,000 100,000 53,000 $680,000 What is the accounting rate of return on the investment? O A. 3.42% OB. 1.55% OC. 3.8% OD. 3.11% Click to select your answer. Uamma Company...
0 The Sisyphoan Corporation is considering investing in a new cane manufacturing machine that has an estimated life of three years. The cost of the machine is $30,000 and the machine will be depreciated straight line over its three-year life to a residual value of $0. The cane manufacturing machine will result in sales of 2000 canes in year 1. Sales are estimated to grow by 9% per year each year through year 3. The price per cane that Sisyphean...
In May 2010, Blackwaler Spring Metal purchased a computanding forming machinery for $750,000. The company expects to use the machinery for 10 years (usetul sfe), at the end of which it will have a $ 200 000 salvad value. Using this information, answer questions (a) through (c) independently (a) If the company used the straight line depreciation method, how much depreciabon deduction for the machinery in 2011? O A. 560,000 OB. 555,000 OC. 565.000 OD. 550.000 double decining Moth b)...
Most questions answered within 3 hours.
-
A solid, uniform disk of radius 0.250 m and mass 53.7 kg rolls
down a ramp...
asked 2 hours ago -
Given the following table of high speed internet access vs.
annual home income:
Home Income
%...
asked 2 hours ago -
A baseball batter hits a 0.145kg baseball straight up into the
air. The baseball leaves the...
asked 3 hours ago -
An FM modulator is tested using
single-tone baseband signal with frequency of 50kHz and a sprectrum...
asked 3 hours ago -
Write the ionic equations for the first stage of salts
hydrolysis.
Anion, Cation?
Na2S
NiSO4
K2SO4...
asked 4 hours ago -
suppose there is a normally distributed population with a mean of
250 and a standard deviation...
asked 5 hours ago -
Question Three
Suppose you as project manager are using the Waterfall
development methodology on a large...
asked 6 hours ago -
Which statement is not true about welfare in Canada?
A.Benefits typically vary based on one's ability...
asked 7 hours ago -
Please help me with FLOWCHART and UML diagram for class,
thank you!
#include <iostream>
#include <fstream>...
asked 7 hours ago -
3. Describe the “logic circuit” of the Lac operon. Which
proteins are bound or not to...
asked 7 hours ago -
Ayesha’s adjusted gross income is $60,000 in 2019. She donated a
piece of artwork with a...
asked 8 hours ago -
For Dijkstra’s shortest path algorithm:
a. Give the Big-O time for Dijkstra’s shortest path algorithm
and...
asked 8 hours ago