Consider an asset with the following cash flows: Year 0 Year 1 Year 2 Year 3 Cash flows ($ millions) −42 18.20 16.80 15.40 The firm uses straight-line depreciation. Thus, for this project, it writes off $14 million per year in years 1, 2, and 3. The discount rate is 10%. a. Complete the following table. b. Does the economic depreciation equal the book depreciation? c. Is the book rate of return the same in each year? d. Is the...
Find the present value of the following mixed stream of cash flows (as of Year 0) using a discount rate of 88%. Assume the cash flows are received at the end of each year. Year Cash Flow Stream 1 5 comma 0005,000 2 4 comma 0004,000 3 3 comma 0003,000 Year Cash Flow Stream 1 5 comma 0005,000 2 4 comma 0004,000 3 3 comma 0003,000 Present Value ($)equals=
Question 2 0.4 out of 1 points Howard Company has a machine with a four year life that costs $30,000. At the end of five years they will receive $150,000. The discount figures are.567 for a single payment at the end of five Pyears and 3.605 for a payment every year for five years Question Selected Match What are the discounted cash flows? E. $55050 What is the net present value? G. $85050 What is the payback period? H. five...
Find the future value at the end of year 3 of the following stream of cash flows received at the end of each year, assuming the firm can earn 8 percent on its investments. Year Amount 1 $10,000 2 16,000 3 19,000 A. $45,000 B. $53,396 C. $47,944 D. $56,690
plz solve Q3.) A lump sum cash flow at end of year I is x, then decreases an amount IG every year until end of gear 8 as the last cash flow. What is the equivalent future value at end of year 8 for all o cash flows from year I to year & above with the annual interest of 6% x= 6000 G=200 is 6%
Consider an asset with the following cash flows: Year 0 Year 1 Year 2 Year 3 Cash flows ($ millions) −60 26.00 24.00 22.00 The firm uses straight-line depreciation. Thus, for this project, it writes off $20 million per year in years 1, 2, and 3. The discount rate is 10%. Complete the following table. Does the economic depreciation equal the book depreciation? Is the book rate of return the same in each year? Is the project's book profitability its...
Effect of Transactions on Cash Flows State the effect (cash receipt or cash payment and amount) of each of the following transactions, considered individually, on cash flows: a. Retired $320,000 of bonds, on which there was $3,200 of unamortized discount, for $333,000. b. Sold 7,000 shares of $15 par common stock for $27 per share. C. Sold equipment with a book value of $51,300 for $73,900. d. Purchased land for $436,000 cash. e. Purchased a building by paying $67,000 cash...
For the cash in flows and out flows shown, what will the payment have to be at the end of Year 8 to pay off the loan taken on Year 0. The rate of interest is as shown and is a yearly rate with annual compounding. RATE 6% Years Cash in flows Cash out flows 0 $650,000 1 ($100,000) 2 ($125,000) 3 ($150,000) 4 ($175,000) 5 $0 6 ($200,000) 7 $0 8 ??? Group of answer choices $61,936 $11,785 $6,302...
Problem 2 (15 pts): Given the cash flow described in the table below Year 0 Year 1 Year 2 18 -3 Revenue Operating cost Capital Cost 18 Year Year 3 4 20 22 -3 -3 Year 5 24 -4 Year Year 6 7 26 28 -5 -8 Year 8 30 .9 -20 -15. Tax Cost -2 -3 -4 -5 -6 -6 -7 Project Cash Flow DCF @ 10% a) What is the projected cash flow? (Fill up the corresponding row...
Consider the following cash flows: Year Cash Flow 0 –$6,800 1 1,950 2 4,100 3 1,750 4 1,450 What is the payback period for the above set of cash flows?