How can the Income-Tax Rate be used in Project Evaluation?

Q: How would you compare two different projects using the net present value method?

A: Net Present Value: It is the present worth of the project's initial cost and the cash flows.  Hence…

Q: Determine the internal rate of return of a project?

A: Capital budgeting analysis is useful to know which projects are profitable and which are not. There…

Q: Why is it important to match your funding with economic life of corresponding asset?

A: The use of assets economic life matching with funding can be an integral tool for financial…

Q: Which of the following best explains the limitations of usin discount rate for evaluating projects?

A: Note: 'Since you have asked multiple questions, we will solve the first question for you. If you…

Q: Which is the most efficient analysis method used to determine the project acceptability on an…

A: Present worth is a financial identicalness approach in which incomes of a venture are estimated at…

Q: Explain Rehabilitation Investment Tax Credits?

A: Income Tax Expenses: The expenses which are related to the taxable income of the individuals and…

Q: Why would the average rate of return differ from the internal rate of return on the same project

A:

Q: Describe the method used to evaluate investment projects?

A: Answer: The following are the methods are used to evaluate the investment proposals of a company.…

Q: Explain the Calculation of Net Income Attributable to New Project?

A: Answer: Companies regularly estimate the income after meeting all the expenses due to the new…

Q: Explain Project Feasibility and Profitability?

A: It is a study containing an itemized portrayal of the project, trailed by a lot of various…

Q: How the Income-Tax Rate to Be Used in Project Evaluation?

A: The income tax rate is used to determine the cash flow after tax. As cash flow after tax helps in…

Q: How can the calculation of Net Income Attributable be done to a new project?

A: The question is based on the concept of Net Income Attributable for new projects.

Q: What are the factors affecting the discount rate used in project valuation?

A: Higher discount rate provides less value and lower the discount rate higher the value of the…

Q: What is required // calculate the required rate of return with an opinion on acceptance or rejection…

A: Rate of return is the return is the return received from an investment. It is the real return…

Q: How can we determine after-tax cash flows for an investmenta project with only operating and…

A: Discount rate is the weighted average cost of capital (WACC) which is used in the project.  WACC is…

Q: The capital budgeting tools: Net Present Value, Payback Period, and Internal Rate of Return. Which…

A: There are different methods of capital budgeting method.

Q: The accounting measure of a project's after-tax profit during a particular time period is known as…

A:

Q: How can a developer create value over and above their project cost when attempting to obtain…

A: Financing refers to a process of raising funds for business activities, and making purchases or…

Q: How is the project profitability index computed, and what does it measure?

A: Profitability Index Profitability index is define as the ratio of net present value of cash inflow…

Q: How is the selection of the social discount rate in public-project evaluation is as critical as the…

A: The social discount rate helps to perform the PW analysis for public projects. This discount rate…

Q: How are project classifications used in the capital budgeting process?

A:

Q: The minimum acceptable rate of return vary from project to project for which reason? Select one: a.…

A: Minimum Acceptable Rate of Return (MARR) is the target rate of return used to evaluate the project…

Q: Describe the process of using the Income-Tax Rate in Project Evaluation?

A: The income tax rate is used to determine the cash flow after tax. As cash flow after tax helps in…

Q: How can we determine the Incremental Analysis for Cost-Only Projects?a

A: Answer: In capital budgeting, incremental analysis is one of the most common decision making methods…

Q: Determine the period necessary to recover both the capital investment and the cost of funds required…

A: The payback period alludes to what extent it takes for a speculator to hit breakeven to recoup the…

Q: What is the Incremental (Marginal) Tax Rate in Project Evaluation?

A: Tax:   A tax is a compulsory charge or a levy imposed upon a taxpayer by a government organization…

Q: Write the formula to evaluate the investment worth of projects?

A: There are many methods to evaluate the investment value of the project like Net Present Value,…

Q: What is the criteria to accept a project based on the net present value and the internal rate of…

A: Net present value (NPV) Is the difference between present value of all cash inflows and initial…

Q: method. Does the project offer an acceptable rate of return? Evaluate the profitability measure…

A: Revenue = $11 *106 Fixed costs = $2*106 Variable cost = $7*106 Depreciation is $2.4 *106 /year  for…

Q: How to calculate the economic profit of each project?

A: Question 4 A: Economic profit is the profits arrived after deducting opportunity cost from the…

Q: How can we measure the true rate of return of any internal portion of an investment project?

A: True rate of return means real rate of return on investment. It is the actual return earned on an…

Q: What do we mean by the economic life of a project?

A: The time span for which an asset or a project generates profits for the owner is known as the…

Q: Why is it important to make the distinction between company required rate of return (WACC) and…

A: WACC is the weighted average rate of return. It is the average cost of funding for a company.…

Q: Which investment return, expected or actual, does GAAP allow in the calculation of benefit cost?

A: Benefit cost: When an entity creates a benefit plan setting aside some moneys to meet future…

Q: What type of projects does the Payback method favor?

A: Payback method: It implies to a method of evaluating investment projects by computing the time, it…

Q: How do we develop the project cash flows, after taxes, over the life of the project?

A: Cash flows of the project include both cash inflows and cash outflows. To develop cash flows…

Q: make the distinction between c

A: Rate of return refers to the percentage of profit or loss on an investment for a specified period…

Q: Determine the real rate of return of this project on an after-tax basis?

A: The after-tax real rate of return is the net monetary benefit of speculation subsequent to modifying…

Q: Define the term Profitability Index? How can we consider the profitability index of a project?

A: The profitability index (PI), then again alluded to as the value investment ratio (VIR) or profit…

Q: Should capital budgeting decisions be made solely on the basis of a project’s NPV?Explain.

A: Capital budgeting decisions are based on various factors in which NPV is one of the factors which…

Q: What is a true indicator of the project's profitability?

A: Answer: Capital budgeting is the whole project investment process and the decision of whether it…

Q: When can a project may fail the net-investment test?

A: Yes, a firm can initiate the withdrawal of the amount invested from the investment pool in which…

Q: How can we determine the required capital investment for an investment project?

A: Estimation of the capital investment is required because this is the foremost decision while…

Q: How capital expenditure(investment) analysis helps in focusing particular projects and program ?

A: Expenditure in the company can be divided into two parts. Revenue expenditures:- expenditure…

Q: Describe the concept of rate of return based on the return on invested capital in terms of a…

A: The term ROIC is used to calculate the profitability or return on invested capital that a business…

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.