The business plan for KnowIt, LLC, a start-up company that manufactures portable multigas detectors, showed equivalent...
The business plan for KnowIt, LLC, a start-up company that manufactures portable multigas detectors, showed equivalent annual cash flows of $400,000 for the first 5 years. If the cash flow in year 1 was $319,000 and the constant increase thereafter was $50,000 per year, what interest rate was used in the calculation?
The interest rate used in the calculation was ______ %
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The business plan for KnowIt, LLC, a start-up company that
manufactures portable multigas detectors, showed equivalent...
The business plan for KnowIt, LLC, a start-up company that manufactures portable multi-gas detectors, showed equivalent...
The business plan for KnowIt, LLC, a start-up company that manufactures portable multi-gas detectors, showed equivalent annual cash flows of $400,000 for the first 5 years. If the cash flow in year 1 was $305,000 and the constant increase thereafter was $50,000 per year, what interest rate was used in the calculation?
AVZ is a start-up company who is using all its cash to growth so it does...
AVZ is a start-up company who is using all its cash to growth so it does not plan to pay dividends for the next 6 years. The company then plans to start paying annual cash dividends starting in year 7 of $6.00 for 10 years. Thereafter, the company will assume a constant growth dividend policy and the estimated growth rate in dividends forever after that point is 2%. The price of the stock is set to yield a return...
7. You start up a new business and your minimum expected return on capital is 10%. You expect after tax cash flows of $...
7. You start up a new business and your minimum expected return on capital is 10%. You expect after tax cash flows of $50,000 one year from now and $100,000 starting two years from now and projected to continue for each year thereafter lasting out to year 10. How much can you afford to pay to invest in the business?
AVZ is a start-up company who is using all its cash to growth so it does...
AVZ is a start-up company who is using all its cash to growth so it does not plan to pay dividends for the next 5 years. The company then plans to start paying annual cash dividends starting in year 6 of $6.00 for 12 years. Thereafter, the company will assume a constant growth dividend policy and the estimated growth rate in dividends forever after that point is 2%. The price of the stock is set to yield a return of...
AVZ is a start-up company who is using all its cash to growth so it does...
AVZ is a start-up company who is using all its cash to growth so it does not plan to pay dividends for the next 4 years. The company then plans to start paying annual cash dividends starting in year 5 of $4.00 for 12 years. Thereafter, the company will assume a constant growth dividend policy and the estimated growth rate in dividends forever after that point is 3%. The price of the stock is set to yield a return of...
A company that manufactures magnetic flow meters expects to undertake a project that will have the...
A company that manufactures magnetic flow meters expects to undertake a project that will have the cash flows estimated -860,000 First cost, $ Equipment replacement cost in -300,000 year 2, $ Annual operating cost, $/year Salvage value, $ -910,000 250,000 4 Life, years At an interest rate of 10% per year, what is the equivalent annual cost of the project? Find the AW value using tabulated factors. The equivalent annual cost of the project is $- 1270315
Nosa Co. is a start-up company and expands the business aggressively. This company starts on January...
Nosa Co. is a start-up company and expands the business aggressively. This company starts on January 1, 2015 and expects that the monthly sales can grow at a constant rate. The company expects sales on credit at the percentage below, with the remaining in cash. Sales growth rate 20% Credit sales percentage 80% Budgeted cash collection in March $747,491 As the company is preparing its schedule of cash collections for credit sales, the following collection curve (schedule) is being used:...
In year 1, Firm A paid $50,000 cash to purchase a tangible business asset. In year...
In year 1, Firm A paid $50,000 cash to purchase a tangible business asset. In year 1 and year 2, it deducted $3,140 and $7,200 depreciation with respect to the asset. Firm A’s marginal tax rate in both years was 21 percent. Now assume that Firm A borrowed $50,000 to purchase the asset. In each year, it paid $3,800 annual interest on the debt. The interest payments were deductible. How does this change in facts affect Firm A’s net cash...
Use financial calc if possible Biotech (BTKH) is a young start-up company and will not pay...
Use financial calc if
possible
Biotech (BTKH) is a young start-up company and will not pay a dividend for the next 10 years because the firm is reinvesting all of its earnings into growing its business. The company will pay a $5.50 dividend 11 years from today and will increase the dividend by 5% per year thereafter. If the required rate of return on this stock is 13%, what is the current share price? (4 points)
NexxGen is a Pharmaceutical Company which is considering investing in a new production line of portable...
NexxGen is a Pharmaceutical Company which is considering investing in a new production line of portable electrocardiogram (ECG) machines for its clients who suffer from cardiovascular diseases. The company has to invest in equipment which costs $2,500,000 and falls within a MARCS depreciation of 5 years, and is expected to have a scrap value of $200,000 at the end of the project. Other than the equipment, the company needs to increase its cash and cash equivalents by $100,000, increase the...
7. You start up a new business and your minimum expected return on capital is 10%. You expect after tax cash flows of $50,000 one year from now and $100,000 starting two years from now and projected to continue for each year thereafter lasting out to year 10. How much can you afford to pay to invest in the business?
AVZ is a start-up company who is using all its cash to growth so it does not plan to pay dividends for the next 5 years. The company then plans to start paying annual cash dividends starting in year 6 of $6.00 for 12 years. Thereafter, the company will assume a constant growth dividend policy and the estimated growth rate in dividends forever after that point is 2%. The price of the stock is set to yield a return of...
AVZ is a start-up company who is using all its cash to growth so it does not plan to pay dividends for the next 4 years. The company then plans to start paying annual cash dividends starting in year 5 of $4.00 for 12 years. Thereafter, the company will assume a constant growth dividend policy and the estimated growth rate in dividends forever after that point is 3%. The price of the stock is set to yield a return of...
A company that manufactures magnetic flow meters expects to undertake a project that will have the cash flows estimated -860,000 First cost, $ Equipment replacement cost in -300,000 year 2, $ Annual operating cost, $/year Salvage value, $ -910,000 250,000 4 Life, years At an interest rate of 10% per year, what is the equivalent annual cost of the project? Find the AW value using tabulated factors. The equivalent annual cost of the project is $- 1270315
Nosa Co. is a start-up company and expands the business aggressively. This company starts on January 1, 2015 and expects that the monthly sales can grow at a constant rate. The company expects sales on credit at the percentage below, with the remaining in cash. Sales growth rate 20% Credit sales percentage 80% Budgeted cash collection in March $747,491 As the company is preparing its schedule of cash collections for credit sales, the following collection curve (schedule) is being used:...
Use financial calc if
possible
Biotech (BTKH) is a young start-up company and will not pay a dividend for the next 10 years because the firm is reinvesting all of its earnings into growing its business. The company will pay a $5.50 dividend 11 years from today and will increase the dividend by 5% per year thereafter. If the required rate of return on this stock is 13%, what is the current share price? (4 points)
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