Homework Answers
Solution:
Annual Depreciation = $116000 / 4 = $29,000
Annual Net Income = revenues - expenses - depreciation = $79020 - $$39000 - $29000 = $11,020
Average Investment = ($116000+ $0)/ 2 = $58,000
Annual Rate of return = Annual Net Income/ Average Investment = $11020/ $58000 = 19%
Yes, The project is acceptable.
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Wayne Company is considering a long-term investment project called ZIP ZIP will require an investment of...
Wayne Company is considering a long-term investment project called ZIP. ZIP will require an investment of...
Wayne Company is considering a long-term
investment project called ZIP. ZIP will require an investment of
$121,720. It will have a useful life of 4 years and no salvage
value. Annual revenues would increase by $80,100, and annual
expenses (excluding depreciation) would increase by $40,100. Wayne
uses the straight-line method to compute depreciation expense. The
company’s required rate of return is 13%.
Compute the annual rate of return
Anual rate of return ____%
Determine whether the project is acceptable?
Accept/Reject...
Wayne Company is considering a long-term investment project called ZIP. ZIP will require an investment of...
Wayne Company is considering a long-term investment project called ZIP. ZIP will require an investment of $121,840. It will have a useful life of 4 years and no salvage value. Annual revenues would increase by $79,300 and annual expenses (excluding depreciation) would increase by $39,800. Wayne uses the straight-line method to compute depreciation expense. The company's required rate of return is 12%. Compute the annual rate of return. (Round answer to 0 decimal places, e.g. 15%.) Annual rate of return...
Bonita Company is considering a long-term investment project called ZIP. ZIP will require an investment of...
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AcceptReject...
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Wayne Company is considering a long-term investment project
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(Round answer to 2 decimal places, e.g.
10.50.)
Cash payback period :
Question 6 Wayne Company is considering a long-term investment project called ZIP. ZIP will require an investment of...
Wayne Company is considering a long-term investment project called ZIP. ZIP will require an investment of...
Wayne Company is considering a long-term investment project called ZIP. ZIP will require an investment of $128,913. It will have a useful life of 4 years and no salvage value. Annual cash inflows would increase by $84,400, and annual cash outflows would increase by $40,100. The company's required rate of return is 12%. Click here to view PV table. Calculate the internal rate of return on this project. (Round answers to 0 decimal places, e.g. 15%.) Internal rate of return...
Wayne Company is considering a long-term investment project called ZIP. ZIP will require an investment of...
Wayne Company is considering a long-term investment project called ZIP. ZIP will require an investment of $120,000. It will have a useful life of 4 years and no salvage value. Annual cash inflows would increase by $80,000, and annual cash outflows would increase by $40,000. The company's required rate of return is 12%. Click here to view PV table. Calculate the net present value on this project. (If the net present value is negative, use either a negative sign preceding...
Do It! Review 12-4 Wayne Company is considering a long-term investment project called ZIP. ZIP will...
Do It! Review 12-4
Wayne Company is considering a long-term investment project
called ZIP. ZIP will require an investment of $133,340. It will
have a useful life of 4 years and no salvage value. Annual cash
inflows would increase by $88,300, and annual cash outflows would
increase by $43,100. The company’s required rate of return is 12%.
Click here to view PV table.
Calculate the internal rate of return on this project.
(Round answers to 0 decimal places,
e.g. 15%.)...
Do It Review 26-5 Your answer is partially correct. Try again. Wayne Company is considering a...
Do It Review 26-5 Your answer is partially correct. Try again. Wayne Company is considering a long-term investment project called ZIP ZIP will require an investment of $118,840. It will have a useful life of 4 years and no salvage value. Annual revenues would increase by $79,300, and annual expenses (excluding depreciation) would increase by $40,100. Wayne uses the straight-line method to compute depreciation expense. The company's required rate of return is 13% Compute the annual rate of return. (Round...
Bonita Company is considering a long-term investment project called ZIP, ZIP will require an investment of...
Bonita Company is considering a long-term investment project called ZIP, ZIP will require an investment of $122,100. It will have a useful life of 4 years and no salvage value. Annual cash inflows would increase by $80,500, and annual cash outflows would increase by $39,800. The company's required rate of return is 12%. Click here to view PV table. Calculate the net present value on this project. (If the net present value is negative, use either a negative sign preceding...
Coronado Company is considering a long-term investment project called ZIP. ZIP will require an investment of...
Coronado Company is considering a long-term investment project
called ZIP. ZIP will require an investment of $122,200. It will
have a useful life of 4 years and no salvage value. Annual cash
inflows would increase by $79,800, and annual cash outflows would
increase by $39,900. The company’s required rate of return is 11%.
Click here to view PV table.
Calculate the net present value on this project. (If
the net present value is negative, use either a negative sign
preceding...
Wayne Company is considering a long-term
investment project called ZIP. ZIP will require an investment of
$121,720. It will have a useful life of 4 years and no salvage
value. Annual revenues would increase by $80,100, and annual
expenses (excluding depreciation) would increase by $40,100. Wayne
uses the straight-line method to compute depreciation expense. The
company’s required rate of return is 13%.
Compute the annual rate of return
Anual rate of return ____%
Determine whether the project is acceptable?
Accept/Reject...
Wayne Company is considering a long-term investment project called ZIP. ZIP will require an investment of $121,840. It will have a useful life of 4 years and no salvage value. Annual revenues would increase by $79,300 and annual expenses (excluding depreciation) would increase by $39,800. Wayne uses the straight-line method to compute depreciation expense. The company's required rate of return is 12%. Compute the annual rate of return. (Round answer to 0 decimal places, e.g. 15%.) Annual rate of return...
Bonita Company is considering a long-term investment project
called ZIP. ZIP will require an investment of $121,600. It will
have a useful life of 4 years and no salvage value. Annual revenues
would increase by $78,904, and annual expenses (excluding
depreciation) would increase by $40,600. Bonita uses the
straight-line method to compute depreciation expense. The company’s
required rate of return is 10%.
Compute the annual rate of return.
Annual rate of return
%
Determine whether the project is acceptable?
AcceptReject...
Wayne Company is considering a long-term investment project
called ZIP. ZIP will require an investment of $128,000. It will
have a useful life of 4 years and no salvage value. Annual cash
inflows would increase by $80,000, and annual cash outflows would
increase by $40,300. Compute the cash payback period.
(Round answer to 2 decimal places, e.g.
10.50.)
Cash payback period :
Question 6 Wayne Company is considering a long-term investment project called ZIP. ZIP will require an investment of...
Wayne Company is considering a long-term investment project called ZIP. ZIP will require an investment of $128,913. It will have a useful life of 4 years and no salvage value. Annual cash inflows would increase by $84,400, and annual cash outflows would increase by $40,100. The company's required rate of return is 12%. Click here to view PV table. Calculate the internal rate of return on this project. (Round answers to 0 decimal places, e.g. 15%.) Internal rate of return...
Wayne Company is considering a long-term investment project called ZIP. ZIP will require an investment of $120,000. It will have a useful life of 4 years and no salvage value. Annual cash inflows would increase by $80,000, and annual cash outflows would increase by $40,000. The company's required rate of return is 12%. Click here to view PV table. Calculate the net present value on this project. (If the net present value is negative, use either a negative sign preceding...
Do It! Review 12-4
Wayne Company is considering a long-term investment project
called ZIP. ZIP will require an investment of $133,340. It will
have a useful life of 4 years and no salvage value. Annual cash
inflows would increase by $88,300, and annual cash outflows would
increase by $43,100. The company’s required rate of return is 12%.
Click here to view PV table.
Calculate the internal rate of return on this project.
(Round answers to 0 decimal places,
e.g. 15%.)...
Do It Review 26-5 Your answer is partially correct. Try again. Wayne Company is considering a long-term investment project called ZIP ZIP will require an investment of $118,840. It will have a useful life of 4 years and no salvage value. Annual revenues would increase by $79,300, and annual expenses (excluding depreciation) would increase by $40,100. Wayne uses the straight-line method to compute depreciation expense. The company's required rate of return is 13% Compute the annual rate of return. (Round...
Bonita Company is considering a long-term investment project called ZIP, ZIP will require an investment of $122,100. It will have a useful life of 4 years and no salvage value. Annual cash inflows would increase by $80,500, and annual cash outflows would increase by $39,800. The company's required rate of return is 12%. Click here to view PV table. Calculate the net present value on this project. (If the net present value is negative, use either a negative sign preceding...
Coronado Company is considering a long-term investment project
called ZIP. ZIP will require an investment of $122,200. It will
have a useful life of 4 years and no salvage value. Annual cash
inflows would increase by $79,800, and annual cash outflows would
increase by $39,900. The company’s required rate of return is 11%.
Click here to view PV table.
Calculate the net present value on this project. (If
the net present value is negative, use either a negative sign
preceding...
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