A project costs 20,00,000 and yields annually a profit of Rs. 3,00,000 after depreciation @ 12½% but before tax at 50%. Calculate the pay-back period

Q: depreciated on a straight-line basis. The before taxes cash flows expected to be generated by the…

A: The process through which a company evaluates possible big projects or investments is known as…

Q: Gold Mining, Inc. is using the profitability index (PI) when evaluating projects. Gold Mining's cost…

A: PI = PV of cash inflows / Initial Cost

Q: A project’s after-tax operating cash flow is $200,000 per year, with operating costs of $100,000 and…

A: Annual sales revenue refers to the total amount received from selling the product. Operating cash…

Q: wion: The project cost of investment is ? 6,00,000 and scrap value of ? 15,000. The profits after…

A: Return per unit of investment :                                                      Under this…

Q: Estimate the approximate before-tax rate of return (ROR) for a project that has a first cost of…

A: Introduction: Return on investment: Return on investment is the measurement of the performance of…

Q: q4b- Project A requires an initial outlay of $10000 and will last for 5 years. The investment will…

A: Depreciation means the loss in value of assets because of usage of assets , passage of time or…

Q: A project is expected to generate annual revenues of $117700, with variable costs of $74,800, and…

A: The term "annual sales revenue" shows the gross earnings before adjusting any expenses generated by…

Q: q4c- Project A requires an initial outlay of $10000 and will last for 5 years. The investment will…

A: Depreciation expense is the total deduction in the book value of a fixed asset due to continuous use…

Q: MMC Company wants to install the recycle plant that cost $80,000 with 10% cost of capital. Year 0 1…

A: The discounted payback period is used to calculate the profitability and timing of cash inflows of a…

Q: Question 1. A project costs 5,00,000 and yields annually a profit of * 75,000 after depreciation @…

A: Here in this question, we are require to calculate the net cash inflows of the project. For…

Q: FCF IS $800 in year 1 and $850 in year 2. Cash flows are expected to be earned at the end of each…

A: The present value is the present worth of the amount that will be paid or received at future.

Q: A project costs Rs 14,000.The estimated annual cash inflows during its 3 year life are Rs 7,000, Rs…

A: To calculate the payback period, we need to find the time that the project has recovered its initial…

Q: A project has an estimated cost of $200,000 with an estimated revenue of $400,000. What is the BCR?

A: Benefit-cost ratio (BCR): It is a ratio that shows the relationship between the relative costs and…

Q: In the fourth and final year of a project, XYZ expects operating cash flow after taxes of P440,000.…

A: The cash flow of the year is what is received after payment of all operating expenses and all…

Q: Fort requires equipment costing $320,000.  It is a  9-year project, and is depreciated straight line…

A: cost of equipment= $320,000 life span of the project= 9 years  Sales generated= $189,000  cost=…

Q: What is the NPV of a 6-year project that costs $100,000, has annual revenues of $50,000 and costs of…

A: The NPV is the present value of the future net benefits less the initial costs.

Q: A project requires an initial investment of $6 million and will yield operating cash flows of $1.5…

A: Here, The equipment cost is $6,000,000. The depreciation rate (D) is 30%. The tax rate is 35%.…

Q: A project has annual depreciation of $25,900, costs of $102,500, and sales of $151,500. The…

A: To find: Operating cash flow

Q: project costs Rs.20,00,000 and yields annually a profit of Rs.3,00,000 after depreciation at 12 ½ %…

A: The payback period refers to the amount of time it takes to recover the cost of an investment.

Q: The initial investment of a project is OMR 30,000. The profit after interest and tax (Cash inflows)…

A: NPV is the sum of present value less initial investment

Q: 7. In a project, the initial outlay is R$30,00,000; useful life of the project is 10 years; net cash…

A: NPV is the difference between Present Value of cash Inflows and Initial Investment. A project with…

Q: A company anticipates a taxable cash expense of $80,000 in year 2 of a project. The company's tax…

A: Cash expense $80,000   Less: Tax benefit ($80,000 x 30%) $24,000   Net cash expense $56,000

Q: Mario Kat, Inc plans a new project.  Calculate its IRR.  Assume that its initial after tax cost is…

A: Internal rate of return is an important concept in corporate finance. IRR is the rate at which the…

Q: Assume a project has estimated fixed costs of $61,200, variable costs per unit of $84.29, a selling…

A: Excel Spreadsheet:

Q: A company has an investment opportunity costing Rs.1,20,000 with the cashflow after tax: Rs. 25,000,…

A: Net present value is the technique used in capital budgeting to evaluate the acceptability of the…

Q: proposed new project has projected sales of $244,500, costs of $123,100, and depreciation of…

A: Cash flows are the cash generated from the operation of the business organisation. In other words,…

Q: c. Project C costs $5,000 and will generate net cash inflows of $2,500 before taxes each year for 5…

A: Annual Depreciation=Cost of Asset-Salvage ValueUseful Life Net Present Value=(Present Value of Cash…

Q: Consider a project with inflows of $20,000 and outflows of $13,000. If the tax rate is 33%, and if…

A: Annual inflow (A) = $20000 Annual outflow (O) = $13000 Tax rate (T) = 33% Let D = Depreciation

Q: What is the NPV of a 6-year project that costs $100,000, has annual revenues of $50,000 and costs of…

A: To select a project, the net present value of cash inflows and outflows are calculated and then…

Q: A project is estimated to cost P120T, last 8 years & have a salvage value of P20T. The annual gross…

A: Net cost is nothing but the opposite of NPV where cost of an investment exceeds the present value of…

Q: 1. Textron is considering a NEW project. The financial projections are as follows: Year 0 Year 1…

A: Net cash flows = Profit after tax + depreciation + Salvage -Tax on salvage - weoking capital Profi…

Q: What is the IRR for the following project if its initial after tax cost is $5,000,000 and it is…

A: Information Provided: Initial cash outflow = $5,000,000 Operatin Cash inflows Year 1 = $1,800,000…

Q: A cost-cutting project will decrease costs by $65,100 a year. The annual depreciation will be…

A: Amount saved due to decrease in cost is $65,100 per year. Annual Depriciation is $15000 Tax rate is…

Q: St. John's & Sons Sanitation Services is evaluating a project that will increase annual sales by…

A: Operating cashflow = (Increase Annual sales - Annual Cash cost) * (1-tax rate) + tax benefit on…

Q: A 7-year project is expected to generate annual sales of 10,400 units at a price of $91 per unit and…

A: Formulas:

Q: A new project is expected to generate annual revenues of $114,500, variable costs of $73,600, and…

A: Annual revenue is $114,500. Annual variable cost is $73,600. Annual fixed cost is $14,000. Annual…

Q: A two-year project has sales of $582,960, cash costs of $411,015, and depreciation expense of…

A: Depreciation expense = $68,109 Tax rate = 0.24   Depreciation tax shield is also known as saving of…

Q: Scott Corporation’s new project calls for an investment of $10,000. It has an estimated life of 10…

A: A discount rate at which the net present worth of an investment is equal to zero is term as an…

Q: A project has sales of $462,000, costs of $274,000, depreciation of $28,000, interest expense of…

A: Given: Sales =$462000Cost =$274000Depreciation =$28000Interest expense =$3400Tax rate =35%

Q: You are analyzing a project and have developed the following estimates. The depreciation is $88,000…

A: In worst case scenario, lower bound should be considered for unit sales and price per unit and upper…

Q: Calculate the Net present value to determine is the company should invest in the following projects.…

A: The Net Present value is computed by determining the present value of the cash outflows and cash…

Q: 3.) A project is estimated to cost $350,000, last 9 years, and have a salvage value of $90,000. The…

A: First we need to calculate present value(PV)  of all annual cash inflows by using this equation PV…

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.