(Ignore income taxes in this problem.) If an investment of $14,760 now will yield $18,000 at the end of one year, then the internal rate of return for this investment to the nearest whole percentage is: Select one: a. 14% b. 18% c. 22% d. 28%
Q: Dividends Per Share Windborn Company has 30,000 shares of cumulative preferred 3% stock, $50 par and…
A: Given that, 3% Cumulative preferred stock = 30,000 shares at $50 par Common stock = 50,000 shares…
Q: is there a $100 need to be deducted as p
A: Adjusted Gross income refers to the total sum value of income gained by an entity after deducting…
Q: May and Jun are partners with profit and loss ratio of 50:50 and capital balances of $300,000 and…
A: A partnership is an agreement between two or more partners where partners are agreed to work…
Q: 1. The annual depreciation taken on a vehicle totals $4,500The vehicle has been in service for two…
A: Depreciation Expenses - Depreciation Expenses are the expense incurred on the wear and tear of the…
Q: cash and cash equivalents include
A: Introduction: Cash is used to buy goods and services and to pay off debts. Items that do not qualify…
Q: What is meant by net income and net loss?
A: When the company has more amount of revenue it would have positive income whereas when company has…
Q: Eplain why a contract existed between your mother and Jewel on June 7, 2022?
A:
Q: Echo Company has assets of $638,000, liabilities of $269,000, and equity of $369,000. It buys office…
A: An accounting equation refers to a mathematical representation of the transaction. It indicates that…
Q: What is meant by Owners’ equity?
A: The balance sheet is the financial statement of the business which represents the financial position…
Q: person bought laptop for $ 10k . Seven years from now the salvage value is $ 500 . Other costs…
A: Present worth of asset is Present value of all cash inflow less present value of of all cash out…
Q: Use the accounting equation to compute the missing financial statement amounts. 2. Use the expanded…
A: The accounting equation states that assets equals to sum of liabilities and shareholders equity.…
Q: Describe business activities that affect a firm’s cash flow.
A: The cash flow statement is a financial statement which is prepared to record the cash flow from…
Q: Ratio Analysis Formula current Current ratio assets/ Current liabilities Account Net sales/ Receivab…
A: There are two companies AIOTHAIM and Panda Inc. Comparing ratios between these two companies. (1)…
Q: E: Abnormal loss of 2,000 units occurs at the end of the process. In process, beg.. *** Received…
A: The equivalent units are calculated on the basis of percentage of the work completed during the…
Q: The information below pertains to xyz limited. 40000 units per month is the normal capability. @ 10…
A: Absorption Costing: absorption costing is also called "Full costing", it is a technique of…
Q: How much is May's new capital after the admission of Julie?
A: When two or more people come together to share all profit and losses is known as a partnership. A…
Q: Benny is supported by the people listed below. 19-year-old child 15-year-old child 67-year-old…
A: The question is related to taxation. The credit amount is up to $3600 in 2021 (previously it was…
Q: . Deferred tax liability, January 1, 2022, $0. 2. Deferred tax asset, January 1, 2022, $0. 3.…
A: >Due to certain factors, there exists a difference between Pretax Financial Income and Taxable…
Q: Given the following information from the payroll register, calculate the net pay and prepare a…
A: Payroll entry is made to record the gross salary along with incentives being paid to the employees…
Q: st in a major new development that will cost € 40 million, and is now considering ways to finance…
A: Capital structure decisions are proportionate relationship between equity and debt in the total…
Q: HIJ acquired all shares and half of the loan stock in KLM whose net assets were revalued by £120,000…
A: Particulars Amount £ Net assets 460000 Less : Investment In KLM X Goodwill 24000
Q: A property was purchased for $4298.00 down and payments of $1073.00 at the end of every three months…
A: Cost of Financing: The cost of financing (FC), often referred to as the cost of finances (COF),…
Q: Dollar Dress Shop’s inventory at cost on January 1 was $82,800. Its retail value was $87,500. During…
A:
Q: Ernst Company's balance sheet shows total liabilities of $32,500,000, total stockholders' equity of…
A: Debt ratio= total debt/Total asset*100 =32500000/40625000 *100 = 80%
Q: ABC Company exchanged equipment with DEF Corp. The following data were available: ABC's equipment…
A: Note: When commercial substance exists in the exchange of assets transaction, new assets are…
Q: (a) Elucidate price and output determination under any two non-collusive models of Oligopoly.
A: The word oligopoly is derived from a combination of 2 Greek words; 'oligos' which means "few" and…
Q: A retailer pays on credit for $650 worth of inventory, terms 3/10, n/40. If the merchandiser pays…
A: Note: 3/10, n/40: Here, 3 represents the discount rate if payment is made within ten days. And if…
Q: McDonald ltd is a retailer of fruit juices. The company has an annual demand of 72,500 barrels. The…
A: EOQ is the quantity at which total cost is lower.But if discount is given by seller or ordering and…
Q: Shane is working as a bookkeeper at ABC Inc. His main duties are to ______. Question 46 options:…
A: Although the phrases bookkeeping and accounting are frequently used interchangeably, accounting…
Q: May, Jun, and Julie are partners with profit and loss ratio of 2:2:1 and capital balances of…
A: Solution: Capital balance of Julie before retirement = P600,000 Amount paid to Julie on retirement =…
Q: The accounting treatment for the sale of the interest of the retiring partner to an outsider or…
A: The retirement of the partner means the partner that is leaving the partnership. The partner can…
Q: Sherrod, Inc., reported pretax accounting income of $76 million for 2021. The following information…
A: Every transaction, per the logic of such a journal entry, must be documented in at least two…
Q: KH Connect Q1, 2017 Q2, 2017 Employee costs 2,250 Q3, 2017 2,200 105 Q2, 2018 2,100 2,200 Q4, 2017…
A: Given, KH Connect and Weblink are two companies. Costs are distributed between different…
Q: Calculating the Return on Sales The income statement, statement of retained earnings, and balance…
A: Return on sales = (Earning before interest and taxes / net sales) *100 Earning before internet and…
Q: What purpose do audits and GAAPs serve in today’s business world?
A: GAAP- GAAP (generally accepted accounting principles) is a set of procedures, standards, and…
Q: The Razooks Company, which manufactures office equipment, is ready to introduce a new line of…
A: Variable manufacturing cost 180 Applied fixed manufacturing cost 60 Variable selling and…
Q: Beginning palances: Assets Liabilities Ending Balances Assets Liabilities During the year: -Net…
A: The accounting equation states that assets equals to sum of liabilities and shareholders equity.
Q: FDN Trading had an initial cash balance of P150,000 at the start of the month representing the…
A: Received P700,000 in service revenue for the month. Increase in cash P700,000 Increase in revenue…
Q: man
A: Step 1 Answer: For first 5 years, r= 10% compounded annually For next 5 years, r= 12% compounded…
Q: Assume that Louisa carried an average balance of $1,000 from her credit card purchases over the past…
A: Interest charges are the amount of cost and charges paid for the amount borrowed either for personal…
Q: May and Jun are partners with profit and loss ratio of 50:50 and capital balances of P5,400,000 and…
A: The new partner brings two things into the business. One is the capital amount and the other is…
Q: Adverse financial and operating circumstances warrant that Solid Company should undergo a…
A: The difference between the par value of a company's shares and the total amount of money received…
Q: d contrast a manual accounting system with a computerized accounting system for process vendors…
A: manual accounting system requires the acting accountant or bookkeeper to post business transactions…
Q: ABC Corp purchased land and building at a lump price of P6M. ABC demolished the building and…
A: The lump sum cost is allocated to assets on the basis of their fair value.
Q: ) Glen, Maria's friend, sees a pair of running shoes on sale in the same store in Duluth for…
A: Glen Should buy pair of shoes for $109.99 as he thinks its value is reduced by $9.01. as the Glen is…
Q: AMT Sdn. Bhd.(ASB) produces exercise mat for fitness centres all over Malaysia. Sales I have…
A: Note: Since you have posted multiple questions, we will solve the first question for you. To get the…
Q: Belinda was involved in a boating accident in 2021. Her speedboat, which was used only for personal…
A: Introduction: When it comes to taxes, your adjusted gross income is just your total income less any…
Q: A company is considering investment of k1,000,000 in a project. The following are the forecasts,…
A: Year Cash Inflows PVF @10 % Present Value 1 10000 0.9091 9091 2 40000 0.8265 40000 3 60000…
Q: SCENARIO Given the following information from the payroll register, calculate the net pay and…
A: Introduction: Payroll is the recompense that a company is required to pay to its employees for a…
Q: A series of cash flows are established on an account as listed below. Payment of P5,854 at the end…
A: Present Value: Given a certain rate of return, the present value (PV) of a future amount of money or…
Step by step
Solved in 2 steps
- Assume that an investment of 100,000 produces a net cash flow of 60,000 per year for two years. The discount factor for year 1 is 0.89 and for year 2 is 0.80. The NPV is a. 0 b. 6,800 c. 1,400 d. (4,000)Towson Industries is considering an investment of $256,950 that is expected to generate returns of $90,000 per year for each of the next four years. What Is the Investments internal rate of return?Buena Vision Clinic is considering an investment that requires an outlay of 600,000 and promises a net cash inflow one year from now of 810,000. Assume the cost of capital is 10 percent. Required: 1. Break the 810,000 future cash inflow into three components: a. The return of the original investment b. The cost of capital c. The profit earned on the investment 2. Now, compute the present value of the profit earned on the investment. 3. Compute the NPV of the investment. Compare this with the present value of the profit computed in Requirement 2. What does this tell you about the meaning of NPV?
- Falkland, Inc., is considering the purchase of a patent that has a cost of $50,000 and an estimated revenue producing life of 4 years. Falkland has a cost of capital of 8%. The patent is expected to generate the following amounts of annual income and cash flows: A. What is the NPV of the investment? B. What happens if the required rate of return increases?Mason, Inc., is considering the purchase of a patent that has a cost of $85000 and an estimated revenue producing lite of 4 years. Mason has a required rate of return that is 12% and a cost of capital of 11%. The patent is expected to generate the following amounts of annual income and cash flows: A. What is the NPV of the investment? B. What happens if the required rate of return increases?Project B cost $5,000 and will generate after-tax net cash inflows of $500 in year one, $1,200 in year two, $2,000 in year three. $2,500 in year four, and $2,000 in year five. What is the NPV using 8% as the discount rate? For further instructions on net present value in Excel, see Appendix C.
- Your division is considering two investment projects, each of which requires an up-front expenditure of 25 million. You estimate that the cost of capital is 10% and that the investments will produce the following after-tax cash flows (in millions of dollars): a. What is the regular payback period for each of the projects? b. What is the discounted payback period for each of the projects? c. If the two projects are independent and the cost of capital is 10%, which project or projects should the firm undertake? d. If the two projects are mutually exclusive and the cost of capital is 5%, which project should the firm undertake? e. If the two projects are mutually exclusive and the cost of capital is 15%, which project should the firm undertake? f. What is the crossover rate? g. If the cost of capital is 10%, what is the modified IRR (MIRR) of each project?The Rodriguez Company is considering an average-risk investment in a mineral water spring project that has an initial after-tax cost of 170,000. The project will produce 1,000 cases of mineral water per year indefinitely, starting at Year 1. The Year-1 sales price will be 138 per case, and the Year-1 cost per case will be 105. The firm is taxed at a rate of 25%. Both prices and costs are expected to rise after Year 1 at a rate of 6% per year due to inflation. The firm uses only equity, and it has a cost of capital of 15%. Assume that cash flows consist only of after-tax profits because the spring has an indefinite life and will not be depreciated. a. What is the present value of future cash flows? (Hint: The project is a growing perpetuity, so you must use the constant growth formula to find its NPV.) What is the NPV? b. Suppose that the company had forgotten to include future inflation. What would they have incorrectly calculated as the projects NPV?Fenton, Inc., has established a new strategic plan that calls for new capital investment. The company has a 9.8% required rate of return and an 8.3% cost of capital. Fenton currently has a return of 10% on its other investments. The proposed new investments have equal annual cash inflows expected. Management used a screening procedure of calculating a payback period for potential investments and annual cash flows, and the IRR for the 7 possible investments are displayed in image. Each investment has a 6-year expected useful life and no salvage value. A. Identify which project(s) is/are unacceptable and briefly state the conceptual justification as to why each of your choices is unacceptable. B. Assume Fenton has $330,000 available to spend. Which remaining projects should Fenton invest in and in what order? C. If Fenton was not limited to a spending amount, should they invest in all of the projects given the company is evaluated using return on investment?
- Ogier Incorporated currently has $800 million in sales, which are projected to grow by 10% in Year 1 and by 5% in Year 2. Its operating profitability ratio (OP) is 10%, and its capital requirement ratio (CR) is 80%? What are the projected sales in Years 1 and 2? What are the projected amounts of net operating profit after taxes (NOPAT) for Years 1 and 2? What are the projected amounts of total net operating capital (OpCap) for Years 1 and 2? What is the projected FCF for Year 2?Your company is planning to purchase a new log splitter for is lawn and garden business. The new splitter has an initial investment of $180,000. It is expected to generate $25,000 of annual cash flows, provide incremental cash revenues of $150,000, and incur incremental cash expenses of $100,000 annually. What is the payback period and accounting rate of return (ARR)?Would you rather have $7,500 today or at the end of 20 years after it has been invested at 15%? Explain your answer. The following are independent situations. For each capital budgeting project, indicate whether management should accept or reject the project and list a brief reason why.