Homework Answers
1.
| End of the month | Cash flow (P) | Rate (r) | Compound (Quaterly) (n) | Time in years (t) |
Compound interest (I = P*(1+r/n)^(n*t)-P |
Principal + Interest (P+I) |
| 0 | (100) | 20% | 4.000 | 1.000 | (21.55) | (121.55) |
| 1 | - | 20% | 4.000 | 0.917 | - | - |
| 2 | (50) | 20% | 4.000 | 0.833 | (8.83) | (58.83) |
| 3 | - | 20% | 4.000 | 0.750 | - | - |
| 4 | (50) | 20% | 4.000 | 0.667 | (6.95) | (56.95) |
| 5 | (50) | 20% | 4.000 | 0.583 | (6.03) | (56.03) |
| 6 | - | 20% | 4.000 | 0.500 | - | - |
| 7 | - | 20% | 4.000 | 0.417 | - | - |
| 8 | 190 | 20% | 4.000 | 0.333 | 12.77 | 202.77 |
| 9 | 200 | 20% | 4.000 | 0.250 | 10.00 | 210.00 |
| 10 | (50) | 20% | 4.000 | 0.167 | (1.65) | (51.65) |
| 11 | 145 | 20% | 4.000 | 0.083 | 2.38 | 147.38 |
| 12 | - | 20% | 4.000 | - | - | - |
| Total | 215.14 |
Answer : C (between $ 200 - $300)
2.
| Year (n) | Net profit (FV) | Annual Rate (r) | PV = FV / ((1+r)^n) |
| 1 | 50,000.00 | 7% | 46,728.97 |
| 2 | 50,000.00 | 7% | 43,671.94 |
| 3 | 45,000.00 | 9% | 34,748.26 |
| 4 | 20,000.00 | 10% | 13,660.27 |
| Total | 138,809.43 | ||
| * | PV = Present Value | ||
| FV = Future Value |
Answer : A (Less than $ 141,000)
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please answer both! it would be greatly appreaciated
Consider a one-year cash flow as follows. Payments...
Please answer both questions, I would appreciate it greatly! (: If you cannot see the picture, I...
Please answer both questions, I would appreciate it greatly!
(:
If you cannot see the picture, I have transcribed below:
1.
Consider the following project and its cash flow:
Investment cost $10,000
Expected life 5 years
Market (salvage) value* -$1,000
Annual receipts $8,000
Annual expense -$4,000
* A negative market value means that there is a net cost to
dispose of an asset.
a. Determine its PW and FW with MARR 15% per year. Is the
project acceptable?
b. What...
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...
Depreciation and accounting cash flow A firm in the third year of depreciating its only asset,...
Depreciation and accounting cash flow A firm in the third year
of depreciating its only asset, which originally cost $173,000 and
has a 5-year MACRS recovery period
, has gathered the following data relative to the current
year's operations:
Accruals
$15,300
Current assets
117,000
Interest expense
15,200
Sales revenue
413,000
Inventory
69,600
Total costs before depreciation, interest and taxes
297,000
Tax rate on ordinary income
21%
a. Use the relevant data to determine the operating cash flow
for the current...
16) You are offered an investment that will pay the following cash flows at the end...
16) You are offered an investment that will pay the following cash flows at the end of each of the next five years at a cost of $800. What is the Net Present Value (NPV) if the required rate of return is 12% per year? Period Cash Flow 0 $0 1 $100 2 $200 3 $300 4 $400 5 $500 Remember that Excel’s NPV function doesn't really calculate the net present value. Instead, it simply calculates the present value of...
Homework #2: Stock Valuation and Cashflow Analysis 2. (60) your department just launched a 4-year project,...
Homework #2: Stock Valuation and Cashflow Analysis 2. (60) your department just launched a 4-year project, involving purchase of a piece of equipment for $300 at period 0. The equipment is to be depreciated evenly and fully in the first two years and will be liquidated at the end of year 4 for $50. Assume that the tax law is such that any losses could be carried over to offset future years' profits before taxes indefinitely. For example, if in...
11 What is the impact on cash flow from operations in the current year based on...
11 What is the impact on cash flow from operations in the current year based on the change in operating assets and liabilities listed below? 2 Balance sheets Prior Year Current Year 4 5 Accounts receivable 6 Inventories 7 Accounts payable 1,725 1,535 1,325 1,825 1,785 1,475 -200 -150 200 12 What's the forecasted capital expenditure based on the information below? Net PP&E beginning of period: 15,000 Net PP&E end of period: 17,500 Depreciation expenses: 2,400 2,500 4,900 100 -100...
5 Consider the investment project with the following net cash flows: Year Net Cash Flow 0...
5 Consider the investment project with the following net cash flows: Year Net Cash Flow 0 $1,500 SX $650 SX What would be the value of X if the project's IRR is known to be 10%? The annual income from a rented house is $24,000. The annual expenses are $6000. If the house can be sold for $245,000 at the end of 10 years, how much could you afford to pay for it now, if you considered 900 to be...
Please provided formulas/equations so i know how to solve for. thank you! Cash Flow Statement Amount...
Please provided formulas/equations so i know how to solve for.
thank you!
Cash Flow Statement Amount Calculations - Chapter 14 End of year Beginning of year Current year Income statement Balance sheet Cash Accounts receivable Inventory Prepaid expenses Total current assets Equipment, at cost Less: Accum. depreciation Net equipment Total assets 86,000 112,000 141,000 18,000 357,000 298,000 (100,000) 198,000 555,000 54,000 126,000 120,000 21,000 321,000 240,000 (76,000) 164,000 485.000 Change 32,000 (14,000) 21,000 (3,000) 36,000 58,000 (24,000) 34,000 70,000 800,000...
Please answer K and L i. What is the present value of the following uneven cash...
Please answer K and L
i. What is the present value of the following uneven cash flow stream? The annual interest rate is 496. 04% 100 $300 $300 $50 j. 1. Wll the future value be larger or smaller is we compound an initial amount more often than annually (e-g., semiannually, holding the stated (nominal) rate constant)? Why? 2. Define a. the stated (or quoted or nominal) rate b. the periodic rate C, the effective annual rate (EAR or EFF%)...
15. aFind the present values of the following cash flow streams at a 6% discount rate....
15. aFind the present values of the following cash flow streams at a 6% discount rate. Do not round intermediate calculations. Round your answers to the nearest cent. 0 1 2 3 4 5 Stream A $0 $100 $450 $450 $450 $300 Stream B $0 $300 $450 $450 $450 $100 Stream A: $ Stream B: $ What are the PVs of the streams at a 0% discount rate? Round your answers to the nearest dollar. Stream A: $ Stream B:...
Please answer both questions, I would appreciate it greatly!
(:
If you cannot see the picture, I have transcribed below:
1.
Consider the following project and its cash flow:
Investment cost $10,000
Expected life 5 years
Market (salvage) value* -$1,000
Annual receipts $8,000
Annual expense -$4,000
* A negative market value means that there is a net cost to
dispose of an asset.
a. Determine its PW and FW with MARR 15% per year. Is the
project acceptable?
b. What...
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...
Depreciation and accounting cash flow A firm in the third year
of depreciating its only asset, which originally cost $173,000 and
has a 5-year MACRS recovery period
, has gathered the following data relative to the current
year's operations:
Accruals
$15,300
Current assets
117,000
Interest expense
15,200
Sales revenue
413,000
Inventory
69,600
Total costs before depreciation, interest and taxes
297,000
Tax rate on ordinary income
21%
a. Use the relevant data to determine the operating cash flow
for the current...
Homework #2: Stock Valuation and Cashflow Analysis 2. (60) your department just launched a 4-year project, involving purchase of a piece of equipment for $300 at period 0. The equipment is to be depreciated evenly and fully in the first two years and will be liquidated at the end of year 4 for $50. Assume that the tax law is such that any losses could be carried over to offset future years' profits before taxes indefinitely. For example, if in...
11 What is the impact on cash flow from operations in the current year based on the change in operating assets and liabilities listed below? 2 Balance sheets Prior Year Current Year 4 5 Accounts receivable 6 Inventories 7 Accounts payable 1,725 1,535 1,325 1,825 1,785 1,475 -200 -150 200 12 What's the forecasted capital expenditure based on the information below? Net PP&E beginning of period: 15,000 Net PP&E end of period: 17,500 Depreciation expenses: 2,400 2,500 4,900 100 -100...
5 Consider the investment project with the following net cash flows: Year Net Cash Flow 0 $1,500 SX $650 SX What would be the value of X if the project's IRR is known to be 10%? The annual income from a rented house is $24,000. The annual expenses are $6000. If the house can be sold for $245,000 at the end of 10 years, how much could you afford to pay for it now, if you considered 900 to be...
Please provided formulas/equations so i know how to solve for.
thank you!
Cash Flow Statement Amount Calculations - Chapter 14 End of year Beginning of year Current year Income statement Balance sheet Cash Accounts receivable Inventory Prepaid expenses Total current assets Equipment, at cost Less: Accum. depreciation Net equipment Total assets 86,000 112,000 141,000 18,000 357,000 298,000 (100,000) 198,000 555,000 54,000 126,000 120,000 21,000 321,000 240,000 (76,000) 164,000 485.000 Change 32,000 (14,000) 21,000 (3,000) 36,000 58,000 (24,000) 34,000 70,000 800,000...
Please answer K and L
i. What is the present value of the following uneven cash flow stream? The annual interest rate is 496. 04% 100 $300 $300 $50 j. 1. Wll the future value be larger or smaller is we compound an initial amount more often than annually (e-g., semiannually, holding the stated (nominal) rate constant)? Why? 2. Define a. the stated (or quoted or nominal) rate b. the periodic rate C, the effective annual rate (EAR or EFF%)...
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