FIN100_Week10Assignment_DP

Year Project 1 Net Cash Flows Project 2 Initial investment $(60,000) $(55,500) 1. 2. 15,000 35,000 27,400 3. 22,000 15,000 22,000 a. Compute payback period for each project. Based on payback period, which project is preferred? b. Compute net present value for each project. Based on net present value, which project is preferred? Complete this question by entering your answers in the tabs below. Required A Required B Compute net present value for each project. Based on net present value, which project is preferred? Note: Round your present value factor to 4 decimals. Round your final answers to the nearest whole dollar. Net Cash Flows Present Value Present Value of Net Factor Cash Flows Project 1 Year 1 Year 2 Year 3 Totals Initial investment Net present value Project 2 Year 1 Year 2 Year 3 Totals Initial investment $ 0 $ 0 $ 0 $ 0 $ 0 Net present value Based on net present value, which project is preferred? $ 0

Homework, Chapter 26 Average Rate of Return The following data are accumulated by Watershed Inc. in evaluating two competing capital investment proposals: Project A Project z Amount of investment $80,000 $92,000 Useful life 4 years 7 years Estimated residual value Estimated total income over the useful life $8,800 $27,370 Determine the expected average rate of return for each project. Round your answers to one decimal place. Project A Project z

Discount Rate 12%         Investment Project Cash Flow Total Net Cash Flow Initial Investment  $           (8,000)  ?  Year 1  $                800 ? Year 2  $                900 ? Year 3  $            1,500 ? Year 4  $            1,800 ? Year 5  $            3,200         NPV of investment $ ? Estimated Payback Period ?       Estimate the total net cash flows, NPV of Investment and Estimated Payback Period using the excel's formula.

Question 2- UNIT 2:  CAPITAL BUDGETTING PROCESS  UNIT 3:   CASH FLOW ESTIMATION   Dorati Inc. is considering two mutually exclusive projects. Dorati used a 15% required rate of return to evaluate capital expenditure projects.  A) Assuming the two projects have the costs and cash flows shown below, determine the NPV for each using a replacement chain.   Year        Project S              Project T 0             –$70,000              –$100,000  1             $50,000                $  60,000 2             $60,000                $  70,000 3                                           $  80,000 4                                           $  90,000   B) Assume in two years Project S will still cost $70,000 and produce the same two years of cash flows.  Find the IRR (using 6% & 8%  or 10% & 11%) of an investment having initial cash outflow of $3,000. The cash inflows during the first, second, third and fourth years are expected to be $700, $800, $900 and $1,200 respectively

Vd Subject: acounting

Question content area top Part 1 ​(IRR calculation​) Determine the IRR on the following​ projects:   a. An initial outlay of ​$13,000 resulting in a single free cash flow of ​$17,165 after 9 years b. An initial outlay of ​$13,000 resulting in a single free cash flow of ​$46,394 after 15 years c. An initial outlay of ​$13,000 resulting in a single free cash flow of $105,001after 25 years d. An initial outlay of ​$13,000 resulting in a single free cash flow of ​$13,653 after 4 years

QUESTION THREE Bates Limited is considering investing in two capital investment projects. The expected capital expenditure and its related cash flows is given in the table below Details Period Project A (K) Project B (K) Cash Expenditure At outset 410,000 500,000 Cash inflow Year 1 140,000 170,000 Cash inflow Year 2 170,000 195,000 Cash inflow Year 3 135,000 180,000 Cash inflow Year 4 110,000 140,000   Your company considers its cost of capital to be 13%. For Project B, assessed as the riskier project of the two, a risk-adjusted cost of capital of 15% is considered appropriate. Base rate is presently 5% and the company pays a margin of 1%, giving an all in borrowing rate of 6%. Inflation is presently 3%. (a) Assess the two projects using the investment appraisal technique of internal rate of return (IRR). (b) State which project you would recommend to your board and explain in detail your reasons. (c) Besides the IRR…

Problem #2 - Chapter 13 – Preference Ranking for Investment Projects The management of Revco Products is exploring four different investment opportunities, Information on the four projects under study follows: Project C (450,000) 522,970 72,970 Project B (360,000) 433,400 73,400 Project A Description Investment Required ($) Present value of Cash Inflows ($) Net Present Value ($) Life of the Project (in years) Project D (270,000) 336,140 66,140 (480,000) 567,270 87,270 6 3 12 6 Internal Rate of Return (%) 18% 19% 14% 16% Because the company's required rate of return is 10%, a 10% discount rate has been used in the present value computations above. Limited funds are available for the investment, so the company cannot accept all the available projects. 1) Compute the project profitability index for each investment project. 2) Rank the four projects according to preference in terms of the following metrics: Net Present Value b. Project Profitability Index Internal Rate of Return a. c. 3)…

QUESTION 32 As a member of Apache Oil Corporation's financial staff, you must estimate the Year 1 cash flow for a proposed project with the following data. What is the Year 1 cash flow? Sales revenues, each year Depreciation Other operating costs Interest expense Tax rate a. $16,351 O b. $17,212 O c. $18,118 O d. $19,071 e. $20,075 $42,500 $10,000 $17,000 $4,000 35.0%

MC algo 9-3 Calculating Payback Period   There is a project with the following cash flows :  Year Cash Flow 0 −$ 24,700 1 7,400 2 7,900 3 7,300 4 5,500  What is the payback period?   Multiple Choice   4.00 years   3.84 years   3.38 years   2.71 years   3.65 years

Part D: Investment Decisions Now consider that Luxio has identified the following two mutually exclusive projects: Year 0 1 2 3 4 Cash Flow (A) -$34,000 $16,500 $14,000 $10,000 $6,000 Cash Flow (B) -$34,000 $5,000 $10,000 $18,000 $19,000. 1. What is the IRR for each of these projects? Based on IRR decision rule, which project should the company accept? 2. If the required return is 11%, what is the NPV for each of these projects? Based on the NPV decision rule, which project should the company accept? 3. Over what range of discount rates would the company choose project A? At what discount rate would the company be indifferent between these two projects? Explain.

Subject: acounting

Investment required Present value of cash inflows - Net present value Life of the project. Internal rate of return 1 Required 1 $ (270,000) 336,140 $ 66,140 Project 6 years 18% Complete this question by entering your answers in the tabs below. Required 2 Compute the profitability index for each investment project. Note: Round your answers to 2 decimal places. Profitability Index 2 $ (450,000) 522,970 $ 72,970 Project Number 3 years 19% The net present values above have been computed using a 10% discount rate. Limited funds are available for investment, so the company can't accept all of the available projects. Required: 1. Compute the profitability index for each investment project. 2. Rank the four projects according to preference, in terms of net present value, profitability index, and internal rate of return. 3 $ (360,000) 433,400 $ 73,400 12 years. 14 $ (480,000) 567,270 $ 87,270 6 years 16%

Question 9 Consider the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) 0 -$50,000 -$25,000 1 $25,000 $10,000 2 $10,000 $10,000 3 $10,000 $10,000 4 $20,000 $5,000 Whichever project you choose, if any, you require a 10 percent return on your investment. If you apply the payback criterion, you will choose investment _____, if you apply the NPV criterion, you will choose investment _____; if you apply the IRR criterion, you will choose investment ____; if you choose the profitability index criterion, you will choose investment ____. Based on your first four answers, which project will you finally choose?  Group of answer choices A; A; A; A; A A; B; A; A; A B; A; A; A; A A; B; B; B; B B; B; B; B; B

11:52 Investment Appraisal (Year 2 Column 2... 35% 4. An investment has the following cash flows. What is the ARR? Year 0 -90,000 Year 1 45,000 10,000 Year 2 Year 3 30,000 30,000 Year 4 6% 7% 9% 5. Which of the following investments would you choose based on payback? Project 3 years 6 months 5 years 10 months A В ... Activity Chat Teams Assignments More

MC algo 9-21 Calculating Profitability Index   POD has a project with the following cash flows:  Year Cash Flows 0 −$ 275,000 1 145,800 2 163,300 3 128,400  The required return is 8.6 percent. What is the profitability index for this project?   Multiple Choice   1.130   .922   .737   1.356   1.243

Question 7 Chestnut Tree Farms has identified the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) 0 -$50,000 -$50,000 1 $35,000 $15,000 2 $8,000 $13,000 3 $7,000 $15,000 4 $6,000 $20,000 If forced to choose one of the two projects above, over what range of discount rates would you choose Project A? Group of answer choices 12.32 percent or less 12.32 percent or more 13.16 percent or less 13.98 percent or less 13.98 percent or more

mg

Consider the two projects in the following table: Year 0 1 23 14.95% What is the crossover point for the two projects? 13.70% 13.25% Expected Net Cash Flow 14.65% Project A -$22,000 $15,000 $15,000 $15,000 Project B -$20,800 $14,100 $14,100 $14,100

Question 16 of 30 View Policies Current Attempt in Progress -/0.35 ⠀ Crane Crafts Corp. management is evaluating two independent capital projects that will each cost the company $200,000. The two projects will provide the following cash flows: Year Project A Project B 1 $66,750 $26,450 2 93,450 66,125 3 34,235 143,250 4 151,655 98,110 (a1) What is the payback period of both projects? (Round answers to 2 decimal places, e.g. 15.25.) The Payback of Project A is years and Project B is eTextbook and Media Save for Later Using multiple attempts will impact your score. 20% score reduction after attempt 2 years. Attempts: 0 of 3 used Submit Answer (a2) The parts of this question must be completed in order. This part will be available when you complete the part above. Search ♡

Porter Company is analyzing two potential investments Initial investment Net cash flow: Year 1 Year 2 Year 3 Year 4 Project X Project Y $ 75,900 $ 64,000 26,000 26,000 26,000 4,400 28,000 28,000 20,000 If the company is using the payback period method, and it requires a payback of three years or less, which project(s) should be selected? 0

Pls help stepwise sir

D, E, F, G, need to be solved

Year 0 $10,000.00 1 $ 3,000.00 Project A Cash Flow Project B Cash Flow $11,000.00 $5,000.00 2 $ 4,000.00 $ 4,000.00 3 $ 5,000.00 $ 4,000.00 4 $3,000.00 $ 3,000.00 Assuming that the relevant cost of capital for both projects is 10%, you should be able to determine the net present value (NPV) and the internal rate of return (IRR) for both project. Assume now that the firm has capital rationing, but knows that its true reinvestment rate is 21%, while its cost of capital is 10 percent. Given this information, determine the modified net present value (MNPV) for Project A. $3,811.27 O $3,622.02 O $4,280.07 O $4,162.90 O $4,404.83

Intro Office Min is considering several risk-free projects: Project Initial cash flow Cash flow in 1 year A -8,100 9,720 -4,000 4,200 -6,500 7,475 B C The risk-free interest rate is 10%. Part 1 What is the NPV of project A? 0+ decimals Submit Part 2 What is the NPV of project B? 0+ decimals Submit Part 3 What is the NPV of project C? 0+ decimals Submit Part 4 Which projects should the company accept? Check all that apply: O Project C Project A Project B Submit

Question list ✔Question 1 Data table A 1 2 Projected cash outflow 3 Net initial investment 4 Projected cash inflows 5 Year 1 6 Year 2 7 Year 3 8 Year 4 9 Required rate of return ↑ Lulus Construction is analyzing its capital expenditure proposals for the purchase of equipment in the coming year. The capital budget is limited to $12,000,000 for the year. Lyssa Bickerson, staff analyst at Lulus, is preparing an analysis of the three projects under consideration by Caden Lulus, the company's owner. (Click the icon to view the data for the three projects.) Present Value of $1 table Read the requirements. B Project A с Project B Present Value of Annuity of $1 table Future Value of $1 table Future Value of Annuity of $1 table D Project C $ 6,000,000 $ 4,000,000 $8,000,000 8% $ 2,050,000 $ 1,100,000 $4,700,000 2,050,000 2,300,000 4,700,000 2,050,000 700,000 50,000 2,050,000 25,000 8% 8% Requirements 1. Because the company's cash is limited, Lulus thinks the payback method should be used to…

MC algo 9-27 Calculating NPV   Living Colour Company has a project available with the following cash flows:  Year Cash Flow 0 −$ 35,550 1 7,880 2 9,450 3 13,350 4 15,490 5 10,160  If the required return for the project is 7.6 percent, what is the project's NPV?   Multiple Choice   $20,780.00   $9,251.98   $10,573.69   $2,207.77   $10,022.98

Subject: acounting

A 6.

QUESTION 14 You have a total of $30,000 to invest in a project and are considering the following three projects: Cash Flows Project A ($30,000) $8,500 Year Project B ($30,000) $19,600 Project C ($30,000) $10,400 1 $9,300 $17,300 $4,500 $10,400 $10,400 3. $10,400 4. $11,200 $4,200 $10,400 $12,300 $2,300 $10,400 If the cost of capital (discount rate) is 10%, which project(s) do you invest in and why? A. Project B- it will pay back the quickest OB. Project C- it generates the greatest cash flow C. Project A-it has the highest accounting rate of return D.Project B-it has the highest net present value E. Project A- it has the highest net present value OF. Project C- it has the highest profitability index

The following table contains information about four projects in which Morales Corporation has the opportunity to invest. This information is based on estimates that different managers have prepared about their potential project. E (Click the icon to view the projects information.) Requirements 1. Rank the four projects in order of preference by using the a. net present value. d. payback period. 2. Which method(s) do you think is best for evaluating capital investment projects in general? Why? c. internal rate of return. b. project profitability index. e. accounting rate of return. Requirement 1. Rank the projects in order of preference. (a) (b) (c) (d) (e) Net Present Profitability Internal Rate Payback Accounting Rate Value Index of Return Period of Return 1st preferred A C 2nd preferred 3rd preferred C 4th preferred ADB D AB