For the same property with net operating cash flows of $15,000, $16,000, $20,000, $22,000, and $17,000 as well as a sale price of $200,000 at the end of the fifth year, what is the IRR if the investor pays $170,000? Answer as a percentage out to 2 decimal places.
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For the same property with net operating cash flows of $15,000, $16,000, $20,000, $22,000, and $17,000 as well as a sale price of $200,000 at the end of the fifth year, what is the
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- Referring to PA7 where Kenzie Company purchased a 3-D printer for $450,000, consider how the purchase of the printer impacts not only depreciation expense each year but also the assets book value. What amount will be recorded as depreciation expense each year, and what will the book value be at the end of each year after depreciation is recorded?Using the information provided, what transaction represents the best application of the present value of an annuity due of $1? A. Falcon Products leases an office building for 8 years with annual lease payments of $100,000 to be made at the beginning of each year. B. Compass, Inc., signs a note of $32,000, which requires the company to pay back the principal plus interest in four years. C. Bahwat Company plans to deposit a lump sum of $100.000 for the construction of a solar farm In 4 years. D. NYC Industries leases a car for 4 yearly annual lease payments of $12,000, where payments are made at the end of each year.The following proforma shows unleveraged cash flows for a property if an investor were to purchase it today and resell it at the end of the third year: (Show answer in Excel) What is the present value of the each of the discounted cash flows from Year 1, Year 2, and Year 3, using a discount rate of 8.75% (hint: calculate each on separately)? What is the Net Present Value of this investment?
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- A company purchases an asset for P10,000 and plans to keep it for 20 years. If the salvage value is zero at the end of 20th year, what is the depreciation in the 3rd year? Use SYD method. With Cash flow diagramA corporation makes an investment of $20,000 that will provide the following cash flows after the corresponding amounts of time:Year 1 - $10,000Year 2 - $10,000Year 3 - $2,000Should the company make this investment? What is the net present value at a 7 percent discount rate? Round your answer to two decimal points.You are offered an asset that costs $150,000 and has cash flows of $1,350 at the end of every month for the next 6years. Assume the cost of capital is 9percent per year.a. What is the IRR of the asset?b. What is the NPV of the asset? c. If your cost of capital is 12percent, should you purchase it? (Setup cash flows in Excel spreadsheets and uses the following Excel Financial functions, IRR, and NPV to derive your answers.
- You paid $725,000 for a duplex and financed 75% of the purchase price. Your forecasted cash flows for the property are listed below and you expect to sell the property for $740,000 at the end of year 5 and you owe $499,318.73 on the property. What is your expected internal rate of return? Cash flow - year 1 $16,000 Cash flow - year 2 $17,000 Cash flow - year 3 $16,000 Cash flow - year 4 $15,000 Cash flow - year 5 $18,000 Answer should be formatted as a percent with two decimal places.Property, in the form of unimproved land, is purchased at a cost of $8000 and is held for 6 years, at which time it is sold for $32,600. Each during the six years of ownership $220 is paid in property tax and may be accounted for at an interest of 12%. The income tax rate on the longterm capital gain is 15% of the gain. Inflation during the period is 4% per year. What is the annual rate of return for this investment?Supposed amarriedcouple wishesto acquire aluxurious condominium in Tagaytay.Thiscan be acquired by a downpayment of P700,000and a yearly payment of P150,000 at the end of each year for a period of 10 years, starting at the end of 5 years from the date of purchase. If money is worth 15% compounded annually, what is the cash price of the property?
