Food Corporation of dalican wants money to construct a new granary. If the granary will cost ₱2,000,000 to the company, how much should it set aside each quarter for 5 years if the rate of interest is 10% per year? Using the formula A =F[i/((1+i)n-1)]

Q: Altmax Ltd, a company that manufactures automobile wiring harnesses, has budgeted P = $400,000 now…

A: Time value of money means that worth of a rupee today is less than the worth of rupee in future.…

Q: Acme Bricks, a masonry products company, wants to have $600000 on hand bef invests in new conveyors,…

A: As the money is deposited in the account and the money grow with time according to the interest rate…

Q: If Php60, 000 is due at the end of 4 years at 5% compounded annually, what is its present value?…

A: Future value (FV) = Php 60,000 Annual interest rate (r) = 5% Period (t) = 4 Years

Q: A pulp and paper company is planning to set aside $150,000 now for possibly replacing its large…

A: A theory that helps to compute the present or future value of the cash flows is term as the TVM…

Q: If a production machine costs $18,000, and we are able to set up the following payment arrangements…

A: Present value of cash flows = Cash flow year1 ( 1 + interest ) +  Cash flow year2 ( 1 + interest ) +…

Q: A pulp and paper company is planning to set aside Php750,000 now for possibly replacing its large…

A: Market interest rate(i) =10%Inflation rate (f)=4%Real interest rate =Market interest rate -Inflation…

Q: Rubbermaid Plastic Corp. invested ₱10,000,000 in manufacturing equipment for producing small…

A: Invested money is ₱10,000,000. Annual interest rate is 5%. Maturity is 7 years. Compounding…

Q: A manufacturer of toilet flush valves wants to have ₱15,000,000 available 10 years from now so that…

A: The given problem relates to concept of annuity. An annuity is a series of uniform cash flows over a…

Q: The IE Department is considering to buy a printing machine that is expected to be obsolete in 5…

A: If an individual or organization wants to purchase a machine first they need to ascertain the future…

Q: Pearson International Publishing Company is trying to decide whether to revise its popular textbook,…

A: The notion of present value asserts that a sum of cash today is worth greater than the same sum in…

Q: Bonita Industries is purchasing new equipment with a cash cost of $ 211800 for the assembly line.…

A: Present value = $211,800 Annuity = $45,800 Period = 6

Q: Consider a growing perpetuity that will pay $100 in one year.  Each year after that, you will…

A: Given, Payment is $100. Growth of payment is 6% interest rate is 11%.

Q: a) Penn Station is saving money to build a new loading platform. Two years ago, they set aside…

A: We will have to use the concept of time value of money. As per the concept of time value of money…

Q: Rubbermaid Plastic Corp. invested P 10,000,000 in manufacturing equipment for producing small…

A: A theory that helps to compute the present or future value of the cash flows is term as the TVM…

Q: os is needed at the end of each year to maintain each building in Rizal Technological University in…

A: Given problem relates to the concept of perpetuity. A perpetuity is a series of uniform cash flows…

Q: A discount furniture store is planning an expansion which will cost 12, 000, 000 three years from…

A: Future value = $ 12,000,000 Annual interest rate = 10% Period = 3 Years Deposit in year 1 = x…

Q: the implementation of a new system would have a payback period of 5 years while gaining Php 175,000…

A: 1)Payback period is a period which shows how much time a project takes to recover the initial…

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: b) Suppose you want to buy a custom-made program to manage your IS project from Supertuna co., and…

A: Present value technique is the method wherein we discount the future cashflows with the applicable…

Q: Franklin Mints, a confectioner, is considering purchasing a new jelly bean-making machine at a cost…

A: IRR is the rate at which NPV of the project is zero.

Q: The project analyst of Carbon Company is considering the purchase of a new computer mainframe for P5…

A: The present value of the amount represents the current value of the future cash flows. The…

Q: A company plans to modernize its facilities in 8 years. They estimate saving $3,281 per month if…

A: Given Information: Savings per month = $3,281 Salvage value = $19,664 Years = 4

Q: The owners of a chain of fast-food restaurants spend $5500000 installing donut makers in all their…

A: Calculation of net present value: Answer: Net present value is -$531,809.74.

Q: Franklin Mints, a confectioner, is considering purchasing a new jelly bean-making machine at a cost…

A: IRR(Internal Rate of Return) is the rate of discounting at which the present value of cash inflows…

Q: A computer equipment has an original cost of $650,000 with a scrap value of $50,000 at the end of…

A: Original cost = $ 650,000 Annual inflation = 2% Period = 8 Years Fund required after 8 years (F) =…

Q: Suppose you are in business and you buy a new machine for $40,000. After paying all other expenses,…

A: We need to compute the rate of return earned by the machine. Machine should be bought if rate of…

Q: At present, a foundation who has 6 million deposit in bank with interest of 10% compounded annually,…

A: As we can see that the cost part comes only within the 4th year and we only have 5 years once the…

Q: How much money can Company C spend now instead of spending $150,000 in year 8 if the interest rates…

A: present value is the value of future cashflow discounted to present day. present value=future…

Q: An electronic device is available that will reduce this year’s labor costs by $8,000. The equipment…

A: Capital budgeting indicates the evaluation of the profitability of possible investments and projects…

Q: What is the present value if the money become Php158, 900 after 5 years of investment using 11.2%…

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

Q: A company makes fixed annual payments to a sinking fund to replace equipment in five years’ time.…

A: Sinking fund is a fund which is established for the purpose of collecting an amount. This amount can…

Q: How much can a construction company afford to spend now on new equipment in lieu of spending 300,000…

A: Solution:- Amount which is to be paid today = Present value of future payments discounted at the…

Q: The Dallas Development Corporation is considering the purchase of an apartment project for $100,000.…

A: Calculating IRR:  Internal rate of return is calculated to find out the discount rate that is…

Q: 1. Sick Oil Company is considering the purchase of a new machine that will last 5 years and cost…

A: The present value function or concept can be used to determine the present value of a future sum or…

Q: Environmental recovery company RexChem Partners plans to finance a site reclamation project that…

A: Given: The company borrows $4.1 million The compounding period n is 4 years Interest is 15% per…

Q: Management is considering buying a pump that costs $20,000 and could save them $7,500 per year over…

A: Solution:- The investment should be made or not will depend on the Net Present Value (NPV). If NPV…

Q: 2. Rubbermaid Plastic Corp. invested P10,000,000 in manufacturing equipment for producing small…

A: The effective annual rate of interest is the actual rate of interest after compounding at a certain…

Q: A) If a company will pay $75,000 for a truck that will increase deliveries to be made which will…

A: The decision should be based on the Net Present value.

Q: The Gables manufacturing Company is looking to replace its conveyor belt system. A new system will…

A: Discounted payback period: It is a variant of payback period that calculates the time it takes for…

Q: A company plans to modernize its facilities in 8 years. They estimate saving $5,783 per month if…

A: Estimated saving Per Month = $5,783.00 Time Period(Years) = 8 Salvage Value = $28,671.00 Nominal…

Q: For this investment, an initial amount of $25,000 should be paid this year (t=0). As of next year…

A: The present value method is a method of finding the productivity of the project by discounting the…

Q: For a major plant expansion project, a company wants to have $63 million 5 years from now If the…

A: Solution: Money is invested somewhere to earn interest on it. The amount initially deposited in…

Q: Mima Sassa wants to spend PHP 600,000 on a new equipment. The machine's estimated service life is…

A: Here, Initial Investment is Php600,000 Annual Cash Flows is Php150,000 Time Period is 6 years

Q: How much can the manufacturer of superconducting magnetic energy storage systems afford to spend now…

A: The required amount is the present of the cash flow at the end of 4 years.

Q: The company plans to purchase $3,000,000 in new assembly line machinery in 5 years. (Use Table 11-1…

A: Present value: The worth of the future sum of money or the stream of payments as of today that is…

Q: A company plans to modernize its facilities in 8 years. They estimate saving $9,518 per month if…

A: To Find: Capital Availability

Q: A pulp and paper company is planning to set aside $150,000 now for possibly replacing its large…

A: Future value = Present value * (1+ rate)^no. of years 8)

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.