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[The following information applies to the questions displayed below.] Cardinal Company is considering a five-year project that would require a $2,975,000 useful life of five years and no salvage value. The company's discount rate income in each of five years as follows: Sales $ 2,735,000 1,000,000 1,735,000 Variable expenses Contribution margin Fixed expenses: Advertising, salaries, and other fixed out- of-pocket costs Depreciation Total fixed expenses $ 735,000 595,000 1,330,000 $ 405,000 Net operating income Click here to view Exhibit 14B-1 and Exhibit 14B-2, to determine the appropriate discount 14. Assume a postaudit showed that all estimates including total sales) were exactly correct ex which actually turned out to be 45%. What was the project's actual payback period? (Round yo

[The following information applies to the questions displayed below.] Cardinal Company is considering a five-year project that would require a $2,975,000 useful life of five years and no salvage value. The company's discount rate income in each of five years as follows: Sales $ 2,735,000 1,000,000 1,735,000 Variable expenses Contribution margin Fixed expenses: Advertising, salaries, and other fixed out- of-pocket costs Depreciation Total fixed expenses $ 735,000 595,000 1,330,000 $ 405,000 Net operating income Click here to view Exhibit 14B-1 and Exhibit 14B-2, to determine the appropriate discount 14. Assume a postaudit showed that all estimates including total sales) were exactly correct ex which actually turned out to be 45%. What was the project's actual payback period? (Round yo

Financial And Managerial Accounting
Financial And Managerial Accounting
15th Edition
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:WARREN, Carl S.
Chapter26: Capital Investment Analysis
Section: Chapter Questions
Problem 2CMA: Staten Corporation is considering two mutually exclusive projects. Both require an initial outlay of...
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Required information [The following information applies to the questions displayed below.] Cardinal Company is considering a five-year project that would require a $2,975,000 investment in equipment with a useful life of five years and no salvage value. The company's discount rate income in each of five years as follows: $ 2,735,000 1,000,000 Sales Variable expenses Contribution margin Fixed expenses: Advertising, salaries, and other fixed out- of-pocket costs Depreciation Total fixed expenses 1,735,000 $ 735,000 595,000 1,330,000 Net operating income $ 405,000 Click here to view Exhibit 14B-1 and Exhibit 14B-2, to determine the appropriate discount factor(s) using table. 14. Assume a postaudit showed that all estimates including total sales) were exactly correct except for the variable expense ratio, which actually turned out to be 45%. What was the project's actual payback period? (Round your answer to 2 decimal places.) Payback period years
Transcribed Image Text:Required information [The following information applies to the questions displayed below.] Cardinal Company is considering a five-year project that would require a $2,975,000 investment in equipment with a useful life of five years and no salvage value. The company's discount rate income in each of five years as follows: $ 2,735,000 1,000,000 Sales Variable expenses Contribution margin Fixed expenses: Advertising, salaries, and other fixed out- of-pocket costs Depreciation Total fixed expenses 1,735,000 $ 735,000 595,000 1,330,000 Net operating income $ 405,000 Click here to view Exhibit 14B-1 and Exhibit 14B-2, to determine the appropriate discount factor(s) using table. 14. Assume a postaudit showed that all estimates including total sales) were exactly correct except for the variable expense ratio, which actually turned out to be 45%. What was the project's actual payback period? (Round your answer to 2 decimal places.) Payback period years
0.593 0.467 Apps School Login iting/garrison_17e/Exhibit/Exhibit_14B_1.htm 0.135 0.255 0 424 A Learn to Code-F. O Mentor Collective G UNC Charlotte | m. A TryHackMe | Lear Canvas Update EXHIBIT 14B-1 Present Value of $1; 1 ( 1 + r ) n Reading L Periods 4% 5% 0.952 6% 7% 8% 9% 10% 0.926 0,917 0.909 0.901 11% 12% 0.893 0.885 0.877 0.797 | 0.783 0.769 0.712 0.693 1 0.962 0.943 13% 14% 15% 0.935 0.873 0.857 0.826 0.816| 0.794 16% 18% 0.870 0.862 0.855 0.847 0.840 0.833 17% 19% 20% 21% 0.826 0.820 0.813 0.806 0.683 0.672 0.661 0.650 0.640 0.925 0.907 0,890 0.873 22% 23% 24% 25% 0.842 0.812 3. 0.756 0.743 0.731 0 0.658 0.641 0.889 0.864 0.840 0.800 0.718 0.706 0.624 0.609 0.593 0.772 0.751 0.731 0.694 4 0.855 0.675 0.823 0.822 | 0.784 0.792 0.763 0.735 0.708 0.579 0.564 0.551| 0.537 | 0.524 0512 0.683 0.041 0.659 0.593 0.564| 0.535 5 0.636 0.613 0.592 0572 0.552 0.534 0.516 0.499 0.482 0.467 0.451 0.713 0.681 0.650 0.747 0.746 0.705 0.567 0.543 0.519 0.497 0.476 0.456 0.480 0.456 0.432 0.410 0.390 0.425 0.400 0.376 0.351 0.437 0.423 0.410 0.370 0.3550.341 0.328 0.289 0.275 0.262 0.021 0.790 0.760 0.711 0.731 0.677 0.703 0.645 0,592 0.437 0.419 0.370 0.352 0.335 0.319 0.666 0.630 0.665 0.623 0.583 0.627 0.582 0.540 | 0,502 0.500 0.508 0.463 0.596 0.419 0.402 0.386 O.J04 0.513 0.507 0.547 0.303 0.482 0.434 0.404 8. 0.452 0.376 0.354 0 333 o 214 0.289 0 206 0270 0.467 0.327 0.308 0.284 0.270 0.247 0.544 0.460 0.424 0.391 | U.191 | 0.179 |0.168 0.361 0.352 0.322 | 0.295 0.317 0.287 0,333 0.225 0.209 | 0.194 0.180 0.167 0.155 0.144 0.134 0.208 0.191 0.176 0.162 0.149 0.137 0.126 0.116 0.107 0.215 0.195 0.178 0.162 0.148 0.135 0.123 0.112 0.103 0.094 0.086 0.137 0.124 0.112 0.102 0.092 0.083 0.076 0.069 10 11 0.263 0.205 0.227 0.676 0.614 | 0,585 0.527 0.557 0.497 0.444 0.558 0.508 0.422 0.243 2 0.386 0.650 1770 0.208 0.178 0.208 0.187 0.168 0.152 0.475 0.350 0.350 0.397 0.356 0.319 0.286 0.257 0.429 0.388 0.261 0.237 12 0.625 0.195 0.530 0.326 0.231 13 0.469 0.100 0.163 0.145 0.601 0.530 0.415 0.368 0.137 0.258 0.229 0.232 0.205 0.209 0,183 0.188 0.163 0.290 0,204 U.520 0.299 0.299 0.275 0.577 0,505 0.388 0.182 0.130 | 0.116 0.104 0.093 0.084 0.075 0.068 0.110 0.099 0.104 0.088 14 0.061 0.055 0.069 0.062 0.055 0.049 0.044 0.045 0.040 0.035 0.054 0.047 0.042 0.036 0.032 0.028 0.442 0.340 0.263 0.181 0.141 0.125 0.111 0.160 0.140 | 0.123 15 0.555 0.481 0.417 0.362 0.315 0.239 0.160 0.108 0.095 0.084 0.074 0.065 0.057 0.051 0.093 |0.081 0.080 0.069 16 0.534 0.458 0.394 0.339 0.292 0.252 0.218 0.188 0.141 0.123 | 0.107 0.071 | 0.062 0.060 0.052 0.045 0.039 0.034 0.030 0.051 | 0.270 0.270 O 199 0.198 17 0.513 0.494 0.436 0.371 0.317 0.231 0.198 0.170 0.146 0.125 0.108 0.093 0.080 0.170 0.153 0.026 0.023 0.028 0.0240.021 0.018 0.027 | 0.023 0.020 | 0.017 | 0.014 18 0.416 0.350 0.296 0.250 0.212 0.180 0.130 0 130 0.095 0.081 0.098 0.083 0.070 0.111 0.212 0.194 0.178 0.180 0.164 0.069 0.059 0.044 0.038 0.032 19 0.475 0.396 0.331 0.277 0.232 0.138 0.116 0.060 0.051 0.043 0.138 0.043 0.037 0.031 0.456 0.258 0.215 0.242 0.199 0.226 0.184 20 0.377 0.312 0.149 0.135 0.104 0.051 0.044 0.124 0.087 0.073 0.061 0.178 0.164 0.037 | 0.031 0.026 0.022 | 0.019 | 0.016 0.014 0.012 0.026 0.022 0.018 0.015 | 0.013 0.011 21 0.439 0.359 0.294 0.112 | 0.093 0.037 0.031 0.032 0.026 0.022 0.018 0.015 0.013 0.011 0.027 | 0.022 0.077 0.064 0.053 0.009 22 0.422 0.342 0.278 | 0.184 0.150 0.123 | 0.101 0.083 0.056 | 0.046 0.049 0.068 0.038 0.033 0.028 0.024 0.020 0.016 0.013 0.009 0.007 0.018 | 0.015 0.012 0.010 0.009 0.007 0.006 0.007 | 0.006 | 0.005 0.007 | 0.006 0.005 0.004 0.004 0.003 0.004 | 0.003 0.002 0.004 0.003 0.002 0.002 0.002 0.002 0.002 0.003 0.003 0.002 0.002 0.001 23 O 406 0.406 0.326 0210 0.310 0.170 | 0.138 0.158 O 146 0.262 | 0.211 0.112 0.091 0.074 0.060 0.040 O 200 0.390 0.102 | 0.082 0,074 24 0.247 | 0.197 0.126 0.066 0.053 0.043 0.035 0.023 0.019 0.015 0.013 0.010 | 0.008 0.047 0.038 0.030 0.184 O 172 0.146 O 135 25 0.375 0.295 0.233 0.116 0.092 0.059 0.010 0.009 0.084 0.076 | 0.060 0.054 0.017 0.014 0.011 0.012 |0.010 0.011 | 0.009 0.007 0.006 0.006 | 0.005 0.042 | 0.033 0.026 0.021 0.106 0.098 0.066 0.053 0.172 O161 26 0.281 0.220 0.135 0.125 0.361 0.268 O 207 0.207 0.047 0.037 0.029 0.023 0.018 0.009 0.007 0.347 0.322 27 0.161 0.042 | 0.033 0.026 0.020 0.048 0.037 0.029 0.022 0.017 28 0.333 0.255 0.196 0.150 0.116 0.090 0.069 0.016 0.008 0.006 0.005 29 0.321 0.243 0.185 0.141 0.107 0.082 0.063 0.014 0.011 0.008 0.006 0.005 0.004 0.003 0.015 0.012 0.009 0.007 0.005 0.004 0.099 | 0.075 0.057 | 0.044 0.033 0.026 0.008 0.020 30 0.308 0.231 0.174 0.131 0.208 0.005 0.004 0.003 | 0.002 0.001 0.001 0.001 0.000 0.000 0.000 0.000 0.000 0.142 | 0.097 | 0.067 0.046 | | 0.015 0.011 0.032 0.022 40 MacBook Pro G Search or type URL esc キ & @ # $ % ! 8 9 3 4 5 6. 1 2
Transcribed Image Text:0.593 0.467 Apps School Login iting/garrison_17e/Exhibit/Exhibit_14B_1.htm 0.135 0.255 0 424 A Learn to Code-F. O Mentor Collective G UNC Charlotte | m. A TryHackMe | Lear Canvas Update EXHIBIT 14B-1 Present Value of $1; 1 ( 1 + r ) n Reading L Periods 4% 5% 0.952 6% 7% 8% 9% 10% 0.926 0,917 0.909 0.901 11% 12% 0.893 0.885 0.877 0.797 | 0.783 0.769 0.712 0.693 1 0.962 0.943 13% 14% 15% 0.935 0.873 0.857 0.826 0.816| 0.794 16% 18% 0.870 0.862 0.855 0.847 0.840 0.833 17% 19% 20% 21% 0.826 0.820 0.813 0.806 0.683 0.672 0.661 0.650 0.640 0.925 0.907 0,890 0.873 22% 23% 24% 25% 0.842 0.812 3. 0.756 0.743 0.731 0 0.658 0.641 0.889 0.864 0.840 0.800 0.718 0.706 0.624 0.609 0.593 0.772 0.751 0.731 0.694 4 0.855 0.675 0.823 0.822 | 0.784 0.792 0.763 0.735 0.708 0.579 0.564 0.551| 0.537 | 0.524 0512 0.683 0.041 0.659 0.593 0.564| 0.535 5 0.636 0.613 0.592 0572 0.552 0.534 0.516 0.499 0.482 0.467 0.451 0.713 0.681 0.650 0.747 0.746 0.705 0.567 0.543 0.519 0.497 0.476 0.456 0.480 0.456 0.432 0.410 0.390 0.425 0.400 0.376 0.351 0.437 0.423 0.410 0.370 0.3550.341 0.328 0.289 0.275 0.262 0.021 0.790 0.760 0.711 0.731 0.677 0.703 0.645 0,592 0.437 0.419 0.370 0.352 0.335 0.319 0.666 0.630 0.665 0.623 0.583 0.627 0.582 0.540 | 0,502 0.500 0.508 0.463 0.596 0.419 0.402 0.386 O.J04 0.513 0.507 0.547 0.303 0.482 0.434 0.404 8. 0.452 0.376 0.354 0 333 o 214 0.289 0 206 0270 0.467 0.327 0.308 0.284 0.270 0.247 0.544 0.460 0.424 0.391 | U.191 | 0.179 |0.168 0.361 0.352 0.322 | 0.295 0.317 0.287 0,333 0.225 0.209 | 0.194 0.180 0.167 0.155 0.144 0.134 0.208 0.191 0.176 0.162 0.149 0.137 0.126 0.116 0.107 0.215 0.195 0.178 0.162 0.148 0.135 0.123 0.112 0.103 0.094 0.086 0.137 0.124 0.112 0.102 0.092 0.083 0.076 0.069 10 11 0.263 0.205 0.227 0.676 0.614 | 0,585 0.527 0.557 0.497 0.444 0.558 0.508 0.422 0.243 2 0.386 0.650 1770 0.208 0.178 0.208 0.187 0.168 0.152 0.475 0.350 0.350 0.397 0.356 0.319 0.286 0.257 0.429 0.388 0.261 0.237 12 0.625 0.195 0.530 0.326 0.231 13 0.469 0.100 0.163 0.145 0.601 0.530 0.415 0.368 0.137 0.258 0.229 0.232 0.205 0.209 0,183 0.188 0.163 0.290 0,204 U.520 0.299 0.299 0.275 0.577 0,505 0.388 0.182 0.130 | 0.116 0.104 0.093 0.084 0.075 0.068 0.110 0.099 0.104 0.088 14 0.061 0.055 0.069 0.062 0.055 0.049 0.044 0.045 0.040 0.035 0.054 0.047 0.042 0.036 0.032 0.028 0.442 0.340 0.263 0.181 0.141 0.125 0.111 0.160 0.140 | 0.123 15 0.555 0.481 0.417 0.362 0.315 0.239 0.160 0.108 0.095 0.084 0.074 0.065 0.057 0.051 0.093 |0.081 0.080 0.069 16 0.534 0.458 0.394 0.339 0.292 0.252 0.218 0.188 0.141 0.123 | 0.107 0.071 | 0.062 0.060 0.052 0.045 0.039 0.034 0.030 0.051 | 0.270 0.270 O 199 0.198 17 0.513 0.494 0.436 0.371 0.317 0.231 0.198 0.170 0.146 0.125 0.108 0.093 0.080 0.170 0.153 0.026 0.023 0.028 0.0240.021 0.018 0.027 | 0.023 0.020 | 0.017 | 0.014 18 0.416 0.350 0.296 0.250 0.212 0.180 0.130 0 130 0.095 0.081 0.098 0.083 0.070 0.111 0.212 0.194 0.178 0.180 0.164 0.069 0.059 0.044 0.038 0.032 19 0.475 0.396 0.331 0.277 0.232 0.138 0.116 0.060 0.051 0.043 0.138 0.043 0.037 0.031 0.456 0.258 0.215 0.242 0.199 0.226 0.184 20 0.377 0.312 0.149 0.135 0.104 0.051 0.044 0.124 0.087 0.073 0.061 0.178 0.164 0.037 | 0.031 0.026 0.022 | 0.019 | 0.016 0.014 0.012 0.026 0.022 0.018 0.015 | 0.013 0.011 21 0.439 0.359 0.294 0.112 | 0.093 0.037 0.031 0.032 0.026 0.022 0.018 0.015 0.013 0.011 0.027 | 0.022 0.077 0.064 0.053 0.009 22 0.422 0.342 0.278 | 0.184 0.150 0.123 | 0.101 0.083 0.056 | 0.046 0.049 0.068 0.038 0.033 0.028 0.024 0.020 0.016 0.013 0.009 0.007 0.018 | 0.015 0.012 0.010 0.009 0.007 0.006 0.007 | 0.006 | 0.005 0.007 | 0.006 0.005 0.004 0.004 0.003 0.004 | 0.003 0.002 0.004 0.003 0.002 0.002 0.002 0.002 0.002 0.003 0.003 0.002 0.002 0.001 23 O 406 0.406 0.326 0210 0.310 0.170 | 0.138 0.158 O 146 0.262 | 0.211 0.112 0.091 0.074 0.060 0.040 O 200 0.390 0.102 | 0.082 0,074 24 0.247 | 0.197 0.126 0.066 0.053 0.043 0.035 0.023 0.019 0.015 0.013 0.010 | 0.008 0.047 0.038 0.030 0.184 O 172 0.146 O 135 25 0.375 0.295 0.233 0.116 0.092 0.059 0.010 0.009 0.084 0.076 | 0.060 0.054 0.017 0.014 0.011 0.012 |0.010 0.011 | 0.009 0.007 0.006 0.006 | 0.005 0.042 | 0.033 0.026 0.021 0.106 0.098 0.066 0.053 0.172 O161 26 0.281 0.220 0.135 0.125 0.361 0.268 O 207 0.207 0.047 0.037 0.029 0.023 0.018 0.009 0.007 0.347 0.322 27 0.161 0.042 | 0.033 0.026 0.020 0.048 0.037 0.029 0.022 0.017 28 0.333 0.255 0.196 0.150 0.116 0.090 0.069 0.016 0.008 0.006 0.005 29 0.321 0.243 0.185 0.141 0.107 0.082 0.063 0.014 0.011 0.008 0.006 0.005 0.004 0.003 0.015 0.012 0.009 0.007 0.005 0.004 0.099 | 0.075 0.057 | 0.044 0.033 0.026 0.008 0.020 30 0.308 0.231 0.174 0.131 0.208 0.005 0.004 0.003 | 0.002 0.001 0.001 0.001 0.000 0.000 0.000 0.000 0.000 0.142 | 0.097 | 0.067 0.046 | | 0.015 0.011 0.032 0.022 40 MacBook Pro G Search or type URL esc キ & @ # $ % ! 8 9 3 4 5 6. 1 2
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