A factory costs $320,000. You forecast that it will produce cash inflows if $100,000 in a year, $160,000 in year 2, and $260,000 in year 3. The discount rate is 10%. what is the value if the factory?

Q: Project L costs $65,000, its expected cash inflows are $12,000 per year for 9 years, andits WACC is…

A: Year cash flow     0                  (65,000.00) 1                    12,000.00 2…

Q: uick computing currently sells 19 million computer chips each year at a price of $23 per chip. It is…

A: Impact on the Cash flow from manufacture of new chips is calculated as follows: Increase in sales of…

Q: A factory costs $460,000. You forecast that it will produce cash inflows of $150,000 in year 1,…

A: Given: Initial cost = $460,000 Year 1 cash inflows = $150,000 Year 2 cash inflows = $210,000 Year 3…

Q: The Steel Factory is considering a project that will produce annual cash flows of $43,800, $40,200,…

A: Internal rate of return (IRR) is the rate at which the Net Present Value (NPV) of the project…

Q: ustrial machine costs $124000 and is expected to earn annual net cash inflows as per the following…

A: NPV if the business sets their required rate of return at 11%  Year Cash flow DF@ 11% Discounted…

Q: A company plans to modernize its facilities in 8 years. They estimate saving $5,000 per month if…

A: Estimated saving Per Month = $5,000.00 Time Period(Years) = 8 Salvage Value = $29,700.00 Nominal…

Q: Project L costs $40,000, its expected cash inflows are $12,000 per year for 11 years, and its WACC…

A: The payback period is the time taken by the investment to recover the cost of the investment.

Q: Project K costs $55,000, its expected cash inflows are $13,000 per year for 8 years, and its WACC is…

A: Hi there, Thanks for posting the question. But as per our Q&A guidelines, we should answer the…

Q: Project K costs $75,000, its expected cash inflows are $15,000 per year for 10 years, and its WACC…

A: Calculate the payback period as follows: Payback period = Initial investment / Cash inflows

Q: Beltway Co. is considering purchasing equipment that has an initial investment of $41,000. The…

A: Introduction : The profitability index (PI) is a metric for determining the desirability of a…

Q: You purchase a machine. It costs $75,000 and will expand cash flow by $1,000 /month in year 1…

A: To Find: NPV  IRR

Q: A factory costs $28000. You forecast that it will produce cash inflows of $80000 in year 1, $140000…

A: The provided information are: Discount rate (r) = 12% = 0.12 Cash outflow = $28000

Q: Should the company make this investment?

A:

Q: Project L costs $40,000, its expected cash inflows are $12,000 per year for 7 years, and its WACC is…

A: Payback period is the amount of time taken by the project to recover its initial cash invested.…

Q: A High Torque DC Motors manufacturer estimated that the permanent magnet component will cost $95,000…

A: Cost per year is $95,000  Time period is 5 years At year, manufacturer mistakenly spends $55,000…

Q: How much value would be added to a firm that could permanently reduce its cash collection period by…

A: Given: Average collection per day =$10000Required to reduce collection period by =2 days

Q: You are the project manager for kpl project and since you don’t sleep much, you get a lot of roject…

A: Note : As per our guidelines, we can only answer 3 subparts at once. Please post other parts…

Q: Project K costs $60,000, its expected cash inflows are $15,000 per year for 8 years, and its WACC is…

A: a) Computation of NPV:

Q: A factory costs $420,000. You forecast that it will produce cash inflows of $130,000 in year 1,…

A: Value of factory = Present Value of cash inflow (PVCI) - Present Value of cash outflow (PVCO)

Q: You are preparing to produce some goods for sale. You will sell them in one year and you will incur…

A: The net present value of a project or investment is the measure of the profitability of the project…

Q: What is the NPV of a project that costs $188,000 today and is expected to generate monthly cash…

A: Net Present Value is the difference between the current value of cash inflow and cash outflow for a…

Q: What is the payback period if a copy shop is thinking about buying a new copier with an initial…

A: The number of days needed to recover the cost of your investment is known as the repayment period.…

Q: A factory costs $330,000. You forecast that it will produce cash inflows of $105,000 in year 1,…

A: The present value function uses a discount factor for converting a series of future cash flows to…

Q: Project K costs $55,000, its expected cash inflows are $13,000 per year for 8 years, and its WACC is…

A: The computation of the discounted payback period as follows: The formula used for the computation…

Q: What is the payback period if a copy shop is thinking about buying a new copier with an initial…

A: Introduction: The payback period is the time required to recoup your capital investment. In layman's…

Q: The company you work for is considering a new product line that is projected to have the net cash…

A: 1 given, inflation adjusted rate =20% year cashflow discounting factor @ 20% pw 0 -10,000 1…

Q: The company is considering investing $810,000 in equipment. They expect the equipment to save…

A: Formulas: Payback period = cash out flows / Cash inflows

Q: Quick Computing currently sells 17 million computer chips each year at a price of $11 per chip. It…

A: Cash flows are the movement of real or virtual money within the organization due to business…

Q: A factory costs $300,000. You forecast that it will product cash inflows of $105,000 in year 1,…

A: Factory Cost= 300,000 Cash inflows: Year 1= 105,000 Year 2 = 165,000  Year 3 = 270,000 Discount rate…

Q: A factory costs $400,000. You forecast that it will produce cash inflows of $115,000 in year 1.…

A: The value of the factory is the sum of present value of future cashflows.

Q: Sharpe Knife Company expects sales next year to be $1,620,000 if the economy is strong, $860,000 if…

A: Expected level of sales can be calculated as the sum of product of probability of respective…

Q: (a) Calculate the NPV of this investment.  (b) Calculate the sensitivity of your calculation to the…

A: Given: Initial investment = 80000 selling cost (A) 16.5 variable cost(B) 12 contribution per…

Q: You are the project manager for kpl project and since you don’t sleep much, you get a lot of roject…

A: Total cash flow for the first two years = Cash inflow per quarter * no. of quarter

Q: What is the payback period if a copy shop is thinking about buying a new copier with an initial…

A: Introduction: The payback period is the amount of time it takes to recoup your investment costs. It…

Q: Suppose we are asked to decide whether a new consumer product should be launched. Based on projected…

A: In the given problem we need to compute NPV & Suggest if the Project can be undertaken or not?

Q: You are considering buying a food truck and other equipment to make a little money in the fall and…

A: Here, Discount Rate is 6% per year Therefore, Monthly Discount Rate is : =6%/12 =0.5%

Q: The following table presents sales forecasts for Golden Gelt Giftware. The unit price is $40. The…

A: Net present value - It is the sum of the present value of all future cash inflows  minus the sum of…

Q: A community project costs GH¢800, 000. You reckon that it will produce an inflow after operating…

A: Frist we need to calculate Present value(PV) of all inflows by using this equation PV =CF1-1(1+i)ni…

Q: Jimmy estimates that a project will cost $50,000 and will generate cash inflows of $12,000 in year…

A: Profitability index method: Profitability index method is also known as the benefit cost ratio or…

Q: Project K costs $30,000, its expected cash inflows are $8,000 per year for 8 years, and its WACC is…

A:

Q: You are purchasing a factory at $550,000. Your projected cash flow streams from the factory will be…

A: Rate of Return for an investment is the yield rate. Every investment decision is based on the return…

Q: A factory costs $290,000. You forecast that it will produce cash inflows of $85,000 in year 1,…

A: For project acceptance decision we will calculate the NPV and IRR of the project

Q: The Tool Box needs to purchase a new machine costing $1.46 million. Management is estimating the…

A: We need to calculate net present value (NPV) of this machine. If NPV is positive than the firm…

Q: A factory cost $330,000. You forecast that it will produce cash inflows of $105,000 in year 1,…

A: All financials are in $.Let PV(I) = Present value of all the cash inflows and Ci be the cash inflow…

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.