Homework Answers
\
Loss on sale of Fixed Asset= Book Value - Sales Relisation
= 80,000-75,000=5,000
Tax Saving on this loss= 35% of 5,000=1,750
After tax cash flow of this sale= Cash reliased + Tax SAving
= 75,000+1,750
= 76,750
Add Answer to:
dont understand, please help! Thank you!
Question 25 (Mandatory) (1 point) One way to account for...
Question 7 (Mandatory) (1 point) When firms use multiple sources of capital, they need to calculate...
Question 7 (Mandatory) (1 point) When firms use multiple sources of capital, they need to calculate the appropriate discount rate for valuing their firm's cash flows as: O a weighted average of the capital components costs. O they apply to each asset as they are purchased with their respective forms of debt or equity. O a sum of the capital components costs. O a simple average of the capital components costs. Question 8 (Mandatory) (1 point) Which of the following...
Question 10 (Mandatory) (1 point) Which of the following statements is true? If the new project...
Question 10 (Mandatory) (1 point) Which of the following statements is true? If the new project is riskier than the firm's existing projects, then it should be charged a higher cost of capital. O If the new project is riskier than the firm's existing projects, then it should be charged a lower cost of capital. If the new project is riskier than the firm's existing projects, then it should be charged the firm's cost of capital. The new project's risk...
vested in a UJITWS are in- eted in an account wild pays 10 percent annually w...
vested in a UJITWS are in- eted in an account wild pays 10 percent annually w today (time o), in lieu of the $2,000 cash flow, would be needed late $20,000 at the end of year 5? (Assume that the cash flows for What cash flow today (time to accumulate $20.000 years 1 through 5 remain the same.) 9.4 Better Health Inc. is eval up-front (time o) expendi Ith Inc. is evaluating two capital investments, each of which requires an...
Please help!Thank you! What information does the payback period provide? Suppose Extensive Enterprises's CFO is evaluating...
Please help!Thank you!
What information does the payback period provide? Suppose Extensive Enterprises's CFO is evaluating a project with the following cash inflows. She does not know the project's initial cost; however, she does know that the project's regular payback period is 2.5 years. If the project's weighted average cost of capital (WACC) is 7%, what is its NPV? Year Year 1 Year 2 Year 3 Year 4 Cash Flow $300,000 $400,000 $450,000 $500,000 O $476,208 O $362,825 $544,237 O...
Please Help! Thank you:) 4. Analysis of a replacement project Aa Ac At times firms will...
Please Help! Thank you:)
4. Analysis of a replacement project Aa Ac At times firms will need to decide if they want to continue to use their current equipment or replace the equipment with newer equipment. The company will need to do replacement analysis to determine which option is the best financial decision for the company. Jones Co. is considering replacing an existing piece of equipment. The project involves the following: • The new equipment will have a cost of...
TexMex Food Company is considering a new salsa whose data are shown below. Under the new...
TexMex Food Company is considering a new salsa whose data are shown below. Under the new tax law, the equipment to be used in the project is eligible for 100% bonus depreciation, so it will be fully depreciated at t = 0. At the end of the project's life, the equipment would have zero salvage value, and no change in net operating working capital (NOWC) would be required for the project. Revenues and operating costs are expected to be constant...
P12-14 (similar to) is Question Help (Related to Checkpoint 12.1) (Calculating project cash flows and NPV)...
P12-14 (similar to) is Question Help (Related to Checkpoint 12.1) (Calculating project cash flows and NPV) You are considering expanding your product line that currently consists of skateboards to include gas-powered skateboards, and you feel you can sell 9,000 of these per year for 10 years (after which time this project is expected to shut down with solar-powered skateboards taking over). The gas skateboards would sell for $130 each with variable costs of $50 for each one produced, and annual...
Important: Show your solutions! QUESTION 1: Consider the following two projects: Year Cash Flow (A) Cash...
Important: Show your solutions! QUESTION 1: Consider the following two projects: Year Cash Flow (A) Cash Flow (B) -$364,000 -$52,000 25,000 46,000 68,000 22,000 68,000 21,500 458,000 17,500 Whichever project you choose, if any, you require a return of 11 percent on your investment. 1) Suppose these two projects are independent. Which project(s) should you accept based on: a. The Payback rule? Explain. (1096) b. The Profitability Index rule? Explain. (10%) c. The IRR rule? Explain. (10%) d. The NPV...
Please Help!! Thank you!:) Shan Co. is considering a four-year project that will require an initial...
Please Help!! Thank you!:)
Shan Co. is considering a four-year project that will require an initial investment of $9,000. The base-case cash flows for this project are projected to be $15,000 per year. The best-case cash flows are projected to be $22,000 per year, and the worst-case cash flows are projected to be - $1,500 per year. The company's analysts have estimated that there is a 50% probability that the project will generate the base-case cash flows. The analysts also...
Please help me. These are two questions but under the same topic/question from my assignment.. Please...
Please help me. These are two questions but under the same
topic/question from my assignment.. Please highlight the answers.
Many thanks!!
6. The payback period Aa The payback method helps firms establish and identify a maximum acceptable payback period that helps in their capital budgeting decisions Consider the case of Cute Camel Woodcraft Company: Cute Camel Woodcraft Company is a small firm, and several of its managers are worried about how soon the firm will be able to recover its...
Question 7 (Mandatory) (1 point) When firms use multiple sources of capital, they need to calculate the appropriate discount rate for valuing their firm's cash flows as: O a weighted average of the capital components costs. O they apply to each asset as they are purchased with their respective forms of debt or equity. O a sum of the capital components costs. O a simple average of the capital components costs. Question 8 (Mandatory) (1 point) Which of the following...
Question 10 (Mandatory) (1 point) Which of the following statements is true? If the new project is riskier than the firm's existing projects, then it should be charged a higher cost of capital. O If the new project is riskier than the firm's existing projects, then it should be charged a lower cost of capital. If the new project is riskier than the firm's existing projects, then it should be charged the firm's cost of capital. The new project's risk...
vested in a UJITWS are in- eted in an account wild pays 10 percent annually w today (time o), in lieu of the $2,000 cash flow, would be needed late $20,000 at the end of year 5? (Assume that the cash flows for What cash flow today (time to accumulate $20.000 years 1 through 5 remain the same.) 9.4 Better Health Inc. is eval up-front (time o) expendi Ith Inc. is evaluating two capital investments, each of which requires an...
Please help!Thank you!
What information does the payback period provide? Suppose Extensive Enterprises's CFO is evaluating a project with the following cash inflows. She does not know the project's initial cost; however, she does know that the project's regular payback period is 2.5 years. If the project's weighted average cost of capital (WACC) is 7%, what is its NPV? Year Year 1 Year 2 Year 3 Year 4 Cash Flow $300,000 $400,000 $450,000 $500,000 O $476,208 O $362,825 $544,237 O...
Please Help! Thank you:)
4. Analysis of a replacement project Aa Ac At times firms will need to decide if they want to continue to use their current equipment or replace the equipment with newer equipment. The company will need to do replacement analysis to determine which option is the best financial decision for the company. Jones Co. is considering replacing an existing piece of equipment. The project involves the following: • The new equipment will have a cost of...
TexMex Food Company is considering a new salsa whose data are shown below. Under the new tax law, the equipment to be used in the project is eligible for 100% bonus depreciation, so it will be fully depreciated at t = 0. At the end of the project's life, the equipment would have zero salvage value, and no change in net operating working capital (NOWC) would be required for the project. Revenues and operating costs are expected to be constant...
P12-14 (similar to) is Question Help (Related to Checkpoint 12.1) (Calculating project cash flows and NPV) You are considering expanding your product line that currently consists of skateboards to include gas-powered skateboards, and you feel you can sell 9,000 of these per year for 10 years (after which time this project is expected to shut down with solar-powered skateboards taking over). The gas skateboards would sell for $130 each with variable costs of $50 for each one produced, and annual...
Important: Show your solutions! QUESTION 1: Consider the following two projects: Year Cash Flow (A) Cash Flow (B) -$364,000 -$52,000 25,000 46,000 68,000 22,000 68,000 21,500 458,000 17,500 Whichever project you choose, if any, you require a return of 11 percent on your investment. 1) Suppose these two projects are independent. Which project(s) should you accept based on: a. The Payback rule? Explain. (1096) b. The Profitability Index rule? Explain. (10%) c. The IRR rule? Explain. (10%) d. The NPV...
Please Help!! Thank you!:)
Shan Co. is considering a four-year project that will require an initial investment of $9,000. The base-case cash flows for this project are projected to be $15,000 per year. The best-case cash flows are projected to be $22,000 per year, and the worst-case cash flows are projected to be - $1,500 per year. The company's analysts have estimated that there is a 50% probability that the project will generate the base-case cash flows. The analysts also...
Please help me. These are two questions but under the same
topic/question from my assignment.. Please highlight the answers.
Many thanks!!
6. The payback period Aa The payback method helps firms establish and identify a maximum acceptable payback period that helps in their capital budgeting decisions Consider the case of Cute Camel Woodcraft Company: Cute Camel Woodcraft Company is a small firm, and several of its managers are worried about how soon the firm will be able to recover its...
Most questions answered within 3 hours.
-
a) summarize the challenges facing New Britain today
b) identify some of its strengths
c) suggest...
asked 4 minutes ago -
The Cost of Equity and
Flotation Costs
Messman Manufacturing
will issue common stock to the public...
asked 2 minutes ago -
**86 at 40 not 88. please show how got Tr in calculations thank
you
2) The...
asked 5 minutes ago -
McGlaun Company pays its employees every two weeks. The firm
last paid its employees on September...
asked 18 minutes ago -
You have been gifted a Mogwai as a pet and decide to do a little
online...
asked 23 minutes ago -
given the standard of 200 mg/dl and the absorbance of that
standard is 0.640. What is...
asked 26 minutes ago -
Exercise 8-51 Algo
An accounting professor is notorious for being stingy in giving
out good letter...
asked 34 minutes ago -
month
total distribution cost
level of activity (unit produced)
july
230.000
3500
august
250.000
3750
september...
asked 35 minutes ago -
A smoke detector system uses two devices, A and B. If smoke is
present, the probability...
asked 1 hour ago -
Your division head has assigned another important project to you
and your team. This project is...
asked 48 minutes ago -
Under normal use conditions, the Mean Time To Failure of a
heating coil can be modeled...
asked 1 hour ago -
Consider the probability that fewer than 34 out of 116 CDs will
be defective. Assume the...
asked 1 hour ago