Can we compute the IRR for each option without knowing the revenue figure? Why?

Q: Which one of the following statement is true about profit maximization? a It foc US or Ountina

A: 1. Profit maximization is the concept that focuses on maximising the profits. This concept ignores…

Q: What is the Economic Value Added (EVA) method? Provide a definition, state a formula, and define all…

A: Economic Value Added (EVA): EVA also called economic profit is a measure of the financial…

Q: Match each of the following terms with the best definition. A. Theory of constraints B. Sunk cost…

A: Given the following question: Theory of constraints Sunk cost Differential analysis Opportunity…

Q: How to correctly find the operating profit? Show an example please.

A: The calculation of operating profit is an important aspect of understanding the financial position…

Q: what are the meaning of Revenue Enhancement and Cost Saving ? and I need examples for each.

A: Revenue enhancement is the enhancement or increase in the revenue, which also leads to an increase…

Q: Determine which of the following two alternatives is the most efficient and which is the most…

A: Internal rate of return (IRR) of an alternative refers to the rate at which the Net present value…

Q: what is the effect of making changes to net present value calculations

A: Net Present Value = Present value of future cashflows - Initial Investment

Q: on. What is the maximum profit possible?

A: In the given question, we have to compute maximum possible profit out of the given availability of…

Q: My question is asking the amount of the total variable expense. Please help.

A: Variable expenses are those which do not remain constant. These expense keeps on varying with the…

Q: What is the meaning of economic value added (EVA)? What does it measure? Why is it important?

A: Economic value added ("EVA") measures a company's financial performance based on the excess wealth…

Q: How does an “opportunity cost”,  subtracting from the revenue of an alternate course of action,…

A: Opportunity cost: Opportunity cost is a loss of income from one alternative if another alternative…

Q: Explain why proponents of LIFO argue that it provides a better match of revenue and expenses. In…

A: "LIFO" stands for last-in, first-out, meaning that the recently purchased inventory items are…

Q: What is the economic rationale for the cost approach? Under what conditions would the cost approach…

A: Answer: Economic rationale for cost approach: The cost approach means that the person who is…

Q: In general terms, how would a change ininvestment opportunities affect the payoutratio under the…

A: Answer: In the residual dividend policy, the distribution is calculated after the company’s spending…

Q: Find an expression for the marginal revenue function, s

A: Marginal revenue is the additional revenue earned from selling one more unit of output.  It is…

Q: What is meant by the term payback period? How is the payback period determined? How can the payback…

A: Meaning: The payback period is the time required to earn back the amount invested in a particular…

Q: What assumptions do you need to make in comparing these mutually exclusive revenue projects?

A: Answer: Mutual exclusive projects are such projects which will accept only one of the projects. For…

Q: What is meant by partitioning the internal rate of return? Why is this procedure meaningful?

A: Internal rate of return is defined as the annual rate of earnings on an investment and unlike income…

Q: What is the major advantage of using a fee-only financialplanner?

A: There are different types of financial planners to help investors plan their finances. Majorly,…

Q: What do we mean by internal rate of return (IRR)?

A: Internal rate of return : Internal rate of return is one of the techniques used in capital budgeting…

Q: Explain realizable value less than cost or cost greater than net realizable value?

A: Introduction:- The following formula used to calculate net realizable value as follows under:- Net…

Q: Why is an incremental analysis necessary when conducting a rate of return analysis for cost…

A: Incremental analysis considers only the relevant cash flows and it does not consider the…

Q: Explain the difference between return of investment versus return on investment.

A: The ratio analysis helps to analyze the financial statements of the business.

Q: Explain different terms are used to refer to rate of return?

A: Answer: Rate of return is nothing but the returns that are expecting on investments made by…

Q: Which of the following methods does not consider the investment’s profitability? ARR Payback NPV…

A: Average rate of return (ARR) and Internal rate of return (IRR) are methods of computing rate of…

Q: The marginal cost of an asset is equivalent to its EUAC. True or False?

A: Marginal Cost of Asset means the cost required to run the asset for the next period. EUAC =…

Q: What is the present breakeven point in revenues?

A:

Q: How should changes in the estimated unguaranteedresidual value be handled by the lessor?

A:

Q: Which of the following transactions will not result in an increase in revenues?

A: In finance revenue increases when a sale takes place or when a transaction adds to the top line/…

Q: What is the relationship between NPV and profitability index (PI)?

A: The concept of net present value is used to decide whether to invest in an investment or not. It is…

Q: What is meant by incremental revenue or incremental cos

A: Incremental Revenue Incremental Revenue means is an additional revenue earned from selling one…

Q: What are the drivers to the cost of revenue

A: The total cost of producing and delivering a product or service to customers is known as the cost of…

Q: What is an opportunity cost? How is this concept used in TVM analysis, and where is itshown on a…

A: The term opportunity cost from the economics view point is defined as the benefits that have been…

Q: How is the payback period is calculated?

A: Payback period is the amount or length of time taken by an investment to recover its cost.

Q: How can we apply Annual-Worth Analysis for the calculation of Unit-Profit or Unit-Cost Calculation?

A: Annual worth analysis is an analysis of value of an investment on an annual basis. It measures the…

Q: Explain the process of Rate-of-Return Calculation with Excel?

A: Rate of return is the rate expressed in terms of percentage which an investor expects from the…

Q: How can we invest in two assets with dissimilar return characteristics?

A: Diversification is one of the tactics to keep in mind while forming a portfolio. Investing all the…

Q: Why do we need to use several rates in order to accommodate the different costs and revenues?

A: Costs: Every business incurs different types of costs, each cost having a different nature. The cost…

Q: How does the residual income approach overcome this problem?

A: Definition: ROI: It is a measure of the amount of return on a particular investment with respect to…

Q: What reinvestment rate is built into the NPV calculation? The IRR calculation?

A: Capital budgeting is a method of investment appraisal. It is a method used for finding the…

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.