Homework Answers
Option (b) is correct
Salvage value of $45000 should be considered as cash inflow in the final year of the project.
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Question 35 5 points SA Rossiter Restaurants is analyzing a project that requires $180,000 of fixed...
please answer all 4 multiple choice questions 5 points COB preferred stock has an 8% stated...
please
answer all 4 multiple choice questions
5 points COB preferred stock has an 8% stated dividend percentage, and a $100 par value. What is the value of the stock if your required rate of return is per year round to the nearest dollar)? $88.89 $72.73 $66.67 $108.00 $112.50 The discount rate that produces an NPV = 0 is the: Break-even return Conventional return Zero return Base return Internal rate of return 5 points Rossiter Restaurants is analyzing a project...
Project A Project B Initial cash outlay $180,000 $160,000 Annual depreciation $25,000 $20,000 Annual net cash...
Project A Project B Initial cash outlay $180,000 $160,000 Annual depreciation $25,000 $20,000 Annual net cash inflow after tax $50,000 $40,000 Expected salvage value $0 $0 Projects A and B are to be evaluated using the payback period and the unadjusted rate of return. State which project should be accepted under each method.
Following is information on two alternative investments being considered by Jolee Company. The company requires a...
Following is information on two alternative investments being considered by Jolee Company. The company requires a 6% return from its investments. (PV of $1. FV of $1. PVA of $1. and FVA of S1) (Use appropriate factor(s) from the tables provided.) Project A $(188,325) Initial investment Expected net cash flows in year: Project B $(148,960) 39, 51,000 82,295 93,400 61,000 26,00 57,000 58,000 84,000 21. a. For each alternative project compute the net present value b. For each alternative project...
Question 17 10 pts Western Tech is considering a new project that will require $118,000 of...
Question 17 10 pts Western Tech is considering a new project that will require $118,000 of fixed assets and networking capital of $16,000. The fixed assets will be depreciated on a straight-line basis to a zero salvage value over three years. This project is expected to produce an operating cash flow of $45,000 the first year with that amount decreasing by 5 percent annually for two years before the project is shut down. The fixed assets can be sold for...
Question 1 Answer 1(a) & 1(d) Your company is considering a new 3-year project that requires...
Question 1 Answer 1(a) & 1(d) Your company is considering a new 3-year project that requires an initial investment in equipment of $3 million. Prior to this, you had engaged a consultant to study the feasibility of the new project and after an extensive market survey, the consultant confirmed your belief that the project would be viable. Your company is charged $100,000 for the feasibility study. The equipment will be depreciated straight line to zero over the 3 years of...
20) Assume a proposed project under consideration by the James River Co. requires $28,900 in fixed...
20) Assume a proposed project under consideration by the James River Co. requires $28,900 in fixed assets. The firm plans to ignore bonus depreciation and instead apply straight-line depreciation to zero over the asset's 6-year life. An aftertax salvage value of $5,400 is expected. The project will produce an annual operating cash flow of $7,300 and will require net working capital of $500 initially plus an additional $500 in Year 3. Net working capital will be restored to its original...
i posted this question already; the answer i got didnt match up with the chart, please...
i posted this question already; the answer i got didnt match
up with the chart, please help!
Problem 24-4A Computing net present value of alternate investments LO P3 Interstate Manufacturing is considering either replacing one of its old machines with a new machine or having the old machine overhauled. Information about the two alternatives follows. Management requires a 10 % rate of return on its investments. Use the (PV of $1. EV of $1. PVA of $1, and FVA of...
Required informatlon The following Information applies to the questions displayed below.] Project A requires a $310,000...
Required informatlon The following Information applies to the questions displayed below.] Project A requires a $310,000 Inltlal Investment for new machinery with a five-year life and a salvage value of $31,500. The company uses stralght-lne depreclation. Project A Is expected to yleld annual net Income of $28,900 per year for the next five years. Compute Project A's accounting rate of return. Accounting Rate of Return Accounting Rate of Return Choose Numerator: Choose Denominator: Accounting rate of return Required information The...
Summer Tyme, Inc., is considering a new 3-year expansion project that requires an initial fixed asset...
Summer Tyme, Inc., is considering a new 3-year expansion project that requires an initial fixed asset investment of $2.43 million. The fixed asset will be depreciated straight-line to zero over its 3-year tax life, after which time it will have a market value (salvage value) of $189,000. The project requires an initial investment in networking capital of $270,000. The project is estimated to generate $2,160,000 in annual sales, with costs of $864,000. The tax rate is 34 percent and the...
Question 21 (3.33 points) You have estimated the value of a planned project by finding the...
Question 21 (3.33 points) You have estimated the value of a planned project by finding the net present value (NPV) of all the cash flows from that project. Which of the following changes would cause the project to look more appealing (have a greater NPV)? Lower discount rate Higher discount rate Higher initial cash outflow (project cost) Cash flows are extended over a longer period of time but the total amount stays the same
please
answer all 4 multiple choice questions
5 points COB preferred stock has an 8% stated dividend percentage, and a $100 par value. What is the value of the stock if your required rate of return is per year round to the nearest dollar)? $88.89 $72.73 $66.67 $108.00 $112.50 The discount rate that produces an NPV = 0 is the: Break-even return Conventional return Zero return Base return Internal rate of return 5 points Rossiter Restaurants is analyzing a project...
Following is information on two alternative investments being considered by Jolee Company. The company requires a 6% return from its investments. (PV of $1. FV of $1. PVA of $1. and FVA of S1) (Use appropriate factor(s) from the tables provided.) Project A $(188,325) Initial investment Expected net cash flows in year: Project B $(148,960) 39, 51,000 82,295 93,400 61,000 26,00 57,000 58,000 84,000 21. a. For each alternative project compute the net present value b. For each alternative project...
Question 17 10 pts Western Tech is considering a new project that will require $118,000 of fixed assets and networking capital of $16,000. The fixed assets will be depreciated on a straight-line basis to a zero salvage value over three years. This project is expected to produce an operating cash flow of $45,000 the first year with that amount decreasing by 5 percent annually for two years before the project is shut down. The fixed assets can be sold for...
Question 1 Answer 1(a) & 1(d) Your company is considering a new 3-year project that requires an initial investment in equipment of $3 million. Prior to this, you had engaged a consultant to study the feasibility of the new project and after an extensive market survey, the consultant confirmed your belief that the project would be viable. Your company is charged $100,000 for the feasibility study. The equipment will be depreciated straight line to zero over the 3 years of...
20) Assume a proposed project under consideration by the James River Co. requires $28,900 in fixed assets. The firm plans to ignore bonus depreciation and instead apply straight-line depreciation to zero over the asset's 6-year life. An aftertax salvage value of $5,400 is expected. The project will produce an annual operating cash flow of $7,300 and will require net working capital of $500 initially plus an additional $500 in Year 3. Net working capital will be restored to its original...
i posted this question already; the answer i got didnt match
up with the chart, please help!
Problem 24-4A Computing net present value of alternate investments LO P3 Interstate Manufacturing is considering either replacing one of its old machines with a new machine or having the old machine overhauled. Information about the two alternatives follows. Management requires a 10 % rate of return on its investments. Use the (PV of $1. EV of $1. PVA of $1, and FVA of...
Required informatlon The following Information applies to the questions displayed below.] Project A requires a $310,000 Inltlal Investment for new machinery with a five-year life and a salvage value of $31,500. The company uses stralght-lne depreclation. Project A Is expected to yleld annual net Income of $28,900 per year for the next five years. Compute Project A's accounting rate of return. Accounting Rate of Return Accounting Rate of Return Choose Numerator: Choose Denominator: Accounting rate of return Required information The...
Summer Tyme, Inc., is considering a new 3-year expansion project that requires an initial fixed asset investment of $2.43 million. The fixed asset will be depreciated straight-line to zero over its 3-year tax life, after which time it will have a market value (salvage value) of $189,000. The project requires an initial investment in networking capital of $270,000. The project is estimated to generate $2,160,000 in annual sales, with costs of $864,000. The tax rate is 34 percent and the...
Question 21 (3.33 points) You have estimated the value of a planned project by finding the net present value (NPV) of all the cash flows from that project. Which of the following changes would cause the project to look more appealing (have a greater NPV)? Lower discount rate Higher discount rate Higher initial cash outflow (project cost) Cash flows are extended over a longer period of time but the total amount stays the same
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