Determine the average rate of return for a project that is estimated to yield total income of $270,400 over 4 years, costs $615,000, and has a $61,000 residual value. %
Q: Determine the average rate of return for a project that is estimated to yield total income of…
A: 1. Formula for average rate of return is = Average annual income or profit/ Initial investment2. To…
Q: A project is estimated to cost 110,000, last 8 years and have a 15,000 salvage value. The annual…
A: A rate of return is the net gain or loss of an investment over a specific period represented as a…
Q: A company's current net operating income is $16,800 and its average operating assets are $80,000.…
A: The residual income of the new project is determined by taking the difference between the estimated…
Q: Average Rate of Return Determine the average rate of return for a project that is estimated to yield…
A: The average rate of return is an approach of comparison the profit of various selections over the…
Q: Determine the annual worth (AW) of a project, where it requires capital investment of BD 40,000, has…
A: Annual Worth = AW is an equal annual series of dollar amounts, over a stated period (N), equivalent…
Q: Average Rate of Return The following data are accumulated by Watershed Inc. in evaluating two…
A:
Q: flows of $21,200 for nine years costs $120,000 today. What is the NPV for the project if the…
A: Net present value or NPV is excess of present value of cash inflows over present value of cash…
Q: What is the interest earned on a project that requires an initial investment of $ 10,000 and…
A: Initial investment (PV) = $ 10,000 Future value (FV) = $ 20,114 Period (n) = 5 Years
Q: For projects A and B determine the payback period(PBP) and the Account rate of return (ARR). The…
A: Payback period and accounting rate of return are tools to evaluate potential investment projects of…
Q: A project requires an initial investment of $170,000 and has a project profitability index of 0.350.…
A: Profitability Ratio The Profitability Index (PI) measures the ratio between the present value of…
Q: You are evaluating projects 1 and 2. The projects have the following yearly operating profit.…
A: Definition: Net present value method: Net present value method is the method which is used to…
Q: what is its IRR? Use 2 financial calculator to determine your answer
A: Information Provided: Initial capital cost = $750,000 Tax operating cash flow per year = $225,000…
Q: Find the net present value (NPV) and profitability index (PI) of a project that costs $1,500 and…
A: The net present value for the project is calculated below:
Q: You are evaluating projects 1 and 2. The projects have the following yearly operating profit.…
A: Since you have posted a question with multiple sub-parts, we will solve the first three sub-parts…
Q: A project that provides annual cash flows of $72,000 for 6 years costs $263,000 today. If the…
A: Initial Cost = 263,000 Annual Cash Flow = 72,000 N = 6 years Required Return = 14%
Q: The annual worth equivalent of a long-life project which has estimated revenues of $50,000 now,…
A: The present value is the value of the sum received at time 0 or the current period. It is the value…
Q: 1.) A project is estimated to cost P100,000, lasts 8 years and have a P10,000 salvage value. The…
A: “Since you have asked multiple questions, we will solve the one question for you. If you want any…
Q: An investment has an initial cost of $410,000 and will generate the net income amounts shown below.…
A: Average Accounting Rate of Return (ARR) = Average Annual Profit / Average Investment
Q: What is the project's NPV?
A: NPV is an abbreviation for Net Present Value. For example, NPV helps us to know the present value of…
Q: A project requires an initial investment of $40 million. It generates cash flows of $25 million in…
A: Calculation of Profitability Index:The profitability index is 1.16.Excel Spreadsheet:
Q: A fixed capital investment of ₱10,000,000 is required for a proposed manufacturing plant and an…
A: Given Information: Fixed capital investment = ₱10,000,000 Estimated working capital = ₱2,000,000…
Q: Average Rate of Return The following data are accumulated by Watershed Inc. in evaluating two…
A: It is also known with the name of the accounting rate of return. We can evaluate by dividing net…
Q: Determine the average rate of return for a project that is estimated to yield total income of…
A: Average rate of return = ? Initial investment = $608,000 Average investment = 1/2 (cost -…
Q: You are given the following forecasted data about a project: Project life = 3 years Required…
A: NPV means PV of net benefit which will arises from the project in the coming years. It is equal to…
Q: Determine the average rate of return for a project that is estimated to yield total income of…
A:
Q: A project with an initial cost of $29,900 is expected to provide cash flows of $9,750, $11,000,…
A: The PI index is the profitability index of the project. The shows the profitability of the project…
Q: Assume a project has estimated fixed costs of $61,200, variable costs per unit of $84.29, a selling…
A: Excel Spreadsheet:
Q: average rate of return for a project
A: Average annual income Total income/Number of years Total income $386,400 Number of years 4…
Q: An investment has an initial cost of $3.2 million. This investment will be depreciated by $900,000 a…
A: The average accounting return or average rate of return is an accounting metric which helps in…
Q: Average Rate of Return Determine the average rate of return for a project that is estimated to yield…
A: Average annual income = $665,820/6 Average annual income = $110,970 Average investment = ($731,600…
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: Average rate of return Determine the average rate of return for a project that is estimated to yield…
A: The average rate of return is calculated as estimated average annual income divided by average…
Q: A project with an initial outlay of $400 has an economic life of 5 years. The project after-tax…
A: The internal rate of return refers to a matrix used for determining the probability of the…
Q: Average Rate of Return Determine the average rate of return for a project that is estimated to yield…
A: It is also known by the name of the accounting rate of return. We can evaluate by dividing average…
Q: A company requires an initial investment of $75,000 with a residual value of $12,500 after five…
A: Answer initial investment = $75,000 residual value = $12,500 annual returns = $20,000 Discounting…
Q: What is the net present value of this project?
A: Net Present Value: It is the difference between the discounted cash inflows and cash outflow. The…
Q: Average Rate of Return Determine the average rate of return for a project that is estimated to…
A: Average Rate of Return is the average rate of profit earned over the investment made. Example: If…
Q: &takeAssignmentSessionLocator=D&inpro... to ... Determine the average rate of return for a project…
A: Average rate of return on project means how much net income is generated by investing a particular…
Q: A project has estimated annual cash flows of $95,000 for four years and is estimated to cost…
A: Net present value = Present value of cash inflows - Initial investment To calculate present value,…
Q: You are considering a five-year project with initial investment of $40,446.46. The required return…
A: The net present value is the technique of evaluation of the performance of long-term capital…
Q: Berwick's Bike shops initial capital cost (not including working capital) is 750,000, expected after…
A: Concept used: Salvage value will be added to the cash flow of year 5. An increase in working capital…
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…
Q: XYZ is considering a project that would last for 3 years and have a cost of capital of 18.20…
A: Year 0 1 2 3 Revenue $ - $ 12,500.00 $ 10,400.00 $…
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- use excel 5. Motor City Productions sells original automotive art on a prepaid basis as each piece is uniquely designed to the customer's specifications. For one project, the cash flows are estimated as follows. Based on the internal rate of return (IRR), should this project be accepted if the required return is 9 percent? (Hint: You may or may not be able to use the simple default IRR rule) (a) IRR is 7.27%. Accept the project. (b) IRR is 7.27%. Reject the project. (c) IRR is 9%. Accept the project. (d) IRR is 9%. Reject the project.NOTE: Provide a format and show your work (example: N = 6, PV = XXX, I = X%, etc.) 1. As the project manager at Jelz, Inc., you are considering a project that will cost $4,276 and produce cash flows of $1,050 in year 1, $1,250 in year 2, $1,250 in year 3, and $1,550 in year 4. Find the rate of return for the project and determine if you should take the project if your required rate of return is 7.15%. (This is a 2 part question, make sure you answer both parts. Numerical answers should be rounded to 2 decimal places.) 2. You are looking to buy a car. You can afford $550 in monthly payments for five years. In addition to the loan, you can make a $6,000 down payment. If interest rates are 7.25 percent APR, what price of car can you afford (loan plus down payment)? (Do not round intermediate calculations and round your final answer to 2 decimal places.)4 You are considering the following investment activity. The facts are the following: Required investment 300,000.00 Discount Rate 9% Life of project 7.00 Years Net income for the project Sales 140,000.00 Expenses Material 25,000.00 Labor 35,000.00 Overhead 15,000.00 Total Expenses 75,000.00 Net Income 65,000.00 What is the NPV of this investment? What is the IRR of this investment? Would you fund this project? Show your work below Year 0 1 2 3 4 5 6 7
- Use Excel’s NPV function for this problem. Riverside Inc. has an 8% cost of capital. The firm has an investment opportunity that costs $1,000. Riverside expects the investment to generate annual cash inflows $360 for each of the next three years. The net present value of the project (rounded to the nearest dollar) is Select one: a. $80. b. $72. c. ($72). d. ($80). Use Excel’s IRR function for this problem. Rancho Cucamonga has a 6% cost of capital. The firm has an investment opportunity that costs $2,000. Riverside expects the investment to generate annual cash inflows $600 for each of the next four years. The internal rate of return and Rancho’s decision are Select one: a. 7.7% and don’t invest in the project. b. 1.7% and don’t invest in the project. c. 1.7% and invest in the project. d. 7.7% and invest in the project. Whitelands Inc. bought equipment for $150. Whitelands estimated that the equipment would last ten years and used the double-declining balance method to depreciate it.…Using the below informtion answer: 5.1 Payback Period of Project Tan (expressed in years, months and days). 5.2 Net Present Value of Project Tan.5.3 Accounting Rate of Return on average investment of Project Tan (expressed to two decimal places). INFORMATIONThe management of Mastiff Enterprises has a choice between two projects viz. Project Cos and Project Tan, each ofwhich requires an initial investment of R2 500 000. The following information is presented to you: PROJECT COS PROJECT TANNet Profit Net ProfitYear R1 130 000 80 0002 130 000 180 0003 130 000 120 0004 130 000 220 0005 130 000 50 000A scrap value of R100 000 is expected for Project Tan only. The required rate of return is 15%. Depreciation is calculatedusing the straight-line method.Q6) IBM networks want to modernize their networking system. Proposals have been received from two major software companies. The first proposal cost $6million but will raise the firm’s annual cash flows by $3million. The second proposal cost $7million and provides cash flow of $3.5million a year. Both projects have a life span of 3 years. Assuming that the cost of capital is 8%, which proposal may be recommended on the basis of Net Present Value criteria. Select one: a. Project B, NPV 1731290 b. Project A, NPV 20198 c. Project B, NPV 2019839 d. Project A, NPV 2019839
- Pls help me solve this without Excel. I got this incorrect. A new IT server for a company will cost $448,864.00 today. The company expects the server will create an incremental cash flow to the firm of $131,277.00 per year. The company wants an 8.00% return for all capital budgeting projects. The company will run the server for the next 5 years. Based on the IRR and cost of capital, should they accept the project? (YES or NO) Answer format: TextHello, can you please answer this problem with excel and formulas, thank you! Kaleb Konstruction, Inc., has the following mutually exclusive projects available. The company has historically used a three-year cutoff for projects. The required return is 10 percent. Year Project F Project G 0 –$135,000 –$205,000 1 60,000 40,000 2 50,000 55,000 3 60,000 90,000 4 55,000 120,000 5 50,000 135,000 a. Calculate the payback period whitout PV for both projects. (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 8,732.16) b. Calculate the NPV for both projects. (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 8,732.16)c. Which project, if any, should the company accept? just write the letter.Compute the payback period (PB), net present value (NPV), internal rate of return (IRR), profitability index (PI) and excess of IRR over k. Assume k at 10%. Due tonight at 9 pm. Decide on which Project will you choose and why? Project X (Videotapes of the Weather Report) ($10,000 investment) Project Y (Slow-Motion Replays of Commercials) ($30,000 investment) Year Cash Flow Year Cash Flow 1 $5,000 1 $15,000 2 3,000 8,000 ........ 3 4,000 9,000 4 3,600 4 11,000 ..
- The management of Bronco Busters Boots Inc. is considering a project with a net initial outlay of $60,000 and an annual net cash inflow estimated at $17,500 over the project's life of 5 years. The project has a cost of capital of 8 percent. What is the project's NPV? Question 4 options: A) −{"version":"1.1","math":"<math xmlns="http://www.w3.org/1998/Math/MathML"><mo>-</mo></math>"}$109 B) $53,821 C) $19,891 D) $9,872b) Find the IRR of the following projects and make your decision. Assume that the projects' cost of capital (or WACC) is 5%.Project X that costs $800 million is expected to generate $60m per year for 18 years. Is this project acceptable?Project Y that costs $100 million is expected to generate $22m per year for 7 years. Is this project acceptable? DO NOT SHOW ME ANSWER IN EXCEL FORM. I NEED STEPS TYPED OUT ON HOW TO SOLVE. ALREADY SUBMITTED THIS QUESTION ONCE TODAY.XY Company is considering 5 investment projects as follows: Project Investment ($) Profitability index (PI) A 10,000 1.2 B 6,000 1.1 C 18,000 1.6 D 14,000 0.9 E 12,000 1.3 The company has $30,000 available for investment. Projects C and E are mutually exclusive. All projects can be undertaken only once and are not divisible. Required: (iii)Calculate the maximum NPV earned from the projects to be picked.