Homework Answers
the common ending date is the end of year 30
30 years is answer
the above is answer..
because it is the common life=3*10=30 years
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5. Suppose Investment A has a 3-year life and Investment B has a 10-year life. Using...
Evergreens Corp. is attempting to evaluate a $129,000 investment in a machine with a 5-year life....
Evergreens Corp. is attempting to evaluate a $129,000 investment in a machine with a 5-year life. The firm has estimated the cash inflows associated with the proposal as shown below. The firm has a 10% cost of capital End of Year (t) Cash Inflows (CF) $15,000 22,000 29,000 32,500 38,000 a. Calculate the payback period for the proposed investment. (2 points) b. Calculate the NPV for the proposed investment. (2 point) c. Calculated the IRR for the proposed investment. (2...
The company has a project with a 5-year life, an initial investment of $195,000, and is...
The company has a project with a 5-year life, an initial investment of $195,000, and is expected to yield annual cash flows of $56,000. Whathat is the present value index of the project if the required rate of return is set at 10%? Present value index = Total present value of net cash flows Initial investment
12-68 Petty Corporation has been depreciating equipment over a 10-year life on which costs $24,000, was...
12-68
Petty Corporation has been depreciating equipment over a 10-year life on which costs $24,000, was purchased on January 1, 2016. The equi $6,000. On the basis of experience since acquisition, management has decided to a total life of 14 years instead of 10, with no change in the estimated residual al tive on January 1, 2020. The annual financial statements are prepared on a c presented). 2019 income and 2020 income before depreciation for 2019 and 2020 wer respectively....
7) An investment of $30,000 has a 12-year useful life and $5000 salvage value at the end of useful life. The annual benefit is $10,000 for the first 4 years, and decreases by $1000 per year after...
7) An investment of $30,000 has a 12-year useful life and $5000 salvage value at the end of useful life. The annual benefit is $10,000 for the first 4 years, and decreases by $1000 per year after that ($9000 for 5th year, $8000 for 6th year,.. What is EUAB of this investment? (-10%) a) $3966 b) $3214 c) $2934 d) S3688
7) An investment of $30,000 has a 12-year useful life and $5000 salvage value at the end of useful...
Problem 5-26 (LO 5-3, 5-4, 5-5, 5-7) On January 1, 2018, Sledge had common stock of $180,000 and retained earnings of $...
Problem 5-26 (LO 5-3, 5-4, 5-5, 5-7) On January 1, 2018, Sledge had common stock of $180,000 and retained earnings of $320,000. During that year, Sledge reported sales of $190,000, cost of goods sold of $100,000, and operating expenses of $46,000. On January 1, 2016, Percy, Inc., acquired 90 percent of Sledge's outstanding voting stock. At that date, $66,000 of the acquisition-date fair value was assigned to unrecorded contracts (with a 20-year life) and $26,000 to an undervalued building (with...
Problem 5-26 (LO 5-3, 5-4, 5-5, 5-7) On January 1, 2018, Sledge had common stock of $130,000 and retained earnings of $270,000. During that year, Sledge reported sales of $140,000, cost of goods sold...
Problem 5-26 (LO 5-3, 5-4, 5-5, 5-7) On January 1, 2018, Sledge had common stock of $130,000 and retained earnings of $270,000. During that year, Sledge reported sales of $140,000, cost of goods sold of $75,000, and operating expenses of $41,000. On January 1, 2016, Percy, Inc., acquired 70 percent of Sledge's outstanding voting stock. At that date, $61,000 of the acquisition-date fair value was assigned to unrecorded contracts (with a 20-year life) and $21,000 to an undervalued building (with...
Consider a project with an initial investment of $50,000 and a 5 year life. Project inflows...
Consider a project with an initial investment of $50,000 and a 5 year life. Project inflows are $25,000 each year and project outflows are $13,000 each year. Depreciation is calculated on a straight line method. If the cash flow in Year 1 is $11,200, what is the tax rate?
3. (5 pts) Create a cash flow for a simple investment project with a 4-year life...
3. (5 pts) Create a cash flow for a simple investment project with a 4-year life that produces a discounted payback of 3 years and an IRR of 8%/year if the MARR is 4%.
E.12.3 investment in an item of equipment is $22,000. It has a five-year life and no...
E.12.3 investment in an item of equipment is $22,000. It has a five-year life and no salvage value and shirt one depreciation method is used the equipment is expected to provide an annual savings of $2900, which does not include depreciation. What is the pay back period?
5. A project requires an initial investment of $200,000, has a four-year life and 1s depreciated...
5. A project requires an initial investment of $200,000, has a four-year life and 1s depreciated straight-line to zero. The firm is in the 34% marginal tax bracket. Other project-relevant information are provided below. Unit Sale 7,000 Price/unit-$125.00, Variable Cost - $105.00, Fixed Costs-$90,000 a. Calculate the annual Operating Cash Flow, Show your computations clearly.(13 pt.) b. If the required return for the project is 7%, should the firm undertake it under this scenario, using the NPV criterion? (7 pt.)...
Evergreens Corp. is attempting to evaluate a $129,000 investment in a machine with a 5-year life. The firm has estimated the cash inflows associated with the proposal as shown below. The firm has a 10% cost of capital End of Year (t) Cash Inflows (CF) $15,000 22,000 29,000 32,500 38,000 a. Calculate the payback period for the proposed investment. (2 points) b. Calculate the NPV for the proposed investment. (2 point) c. Calculated the IRR for the proposed investment. (2...
12-68
Petty Corporation has been depreciating equipment over a 10-year life on which costs $24,000, was purchased on January 1, 2016. The equi $6,000. On the basis of experience since acquisition, management has decided to a total life of 14 years instead of 10, with no change in the estimated residual al tive on January 1, 2020. The annual financial statements are prepared on a c presented). 2019 income and 2020 income before depreciation for 2019 and 2020 wer respectively....
7) An investment of $30,000 has a 12-year useful life and $5000 salvage value at the end of useful life. The annual benefit is $10,000 for the first 4 years, and decreases by $1000 per year after that ($9000 for 5th year, $8000 for 6th year,.. What is EUAB of this investment? (-10%) a) $3966 b) $3214 c) $2934 d) S3688
7) An investment of $30,000 has a 12-year useful life and $5000 salvage value at the end of useful...
Problem 5-26 (LO 5-3, 5-4, 5-5, 5-7) On January 1, 2018, Sledge had common stock of $180,000 and retained earnings of $320,000. During that year, Sledge reported sales of $190,000, cost of goods sold of $100,000, and operating expenses of $46,000. On January 1, 2016, Percy, Inc., acquired 90 percent of Sledge's outstanding voting stock. At that date, $66,000 of the acquisition-date fair value was assigned to unrecorded contracts (with a 20-year life) and $26,000 to an undervalued building (with...
5. A project requires an initial investment of $200,000, has a four-year life and 1s depreciated straight-line to zero. The firm is in the 34% marginal tax bracket. Other project-relevant information are provided below. Unit Sale 7,000 Price/unit-$125.00, Variable Cost - $105.00, Fixed Costs-$90,000 a. Calculate the annual Operating Cash Flow, Show your computations clearly.(13 pt.) b. If the required return for the project is 7%, should the firm undertake it under this scenario, using the NPV criterion? (7 pt.)...
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