The initial cost of a project is 2,180,441 and annual income is 597,733. The expected life to be 12 years, and MARR is 15 percent year. Find PBP.

Q: Determine the average rate of return for a project that is estimated to yield total income of…

A: 1. Formula for average rate of return is = Average annual income or profit/ Initial investment2. To…

Q: Project L costs $46,572.76, its expected cash inflows are $11,000 per year for 8 years, and its WACC…

A: Capital investment refers to all those activities that a business entity undergoes while allocating…

Q: A project has a first cost of $75,000, operating and maintenance costs of $10,000 during each year…

A: Present value of annual cashflows is given by, PV = E x AF = E x (1-(1+r)-n )/r  Where E = cashflows…

Q: If a project costs $120,000 and is expected toreturn $40,000 annually, how long does it take…

A:

Q: An investment costs $500,000 today and is expected to produce a one-time inflow at the end of year 8…

A: Investment amount (P) = $ 500000 Cash inflow after 8 years (FV) = $ 600000 Period (n) = 8 Years

Q: There is a project that requires an investment of 20 thousand usd and its expected benefit is 7,500…

A: Internal rate of return: The internal rate of return is the rate at which the net present value of…

Q: what is the projects equivalent annual cost, or EAC?

A:

Q: Project L costs $59,988.21, its expected cash inflows are $12,000 per year for 11 years, and its…

A: The internal rate of return is the rate at which the present value of cash inflows are equal to the…

Q: The initial cost of a project is 2,180,441 and annual income is 597,733 . The expected life to be 12…

A: Initial Cost = 2,180,441 Annual Income = 597,733 Life = 12 years MARR = 15%

Q: Project K costs $51275, its expected net cash inflows are $13000 per year for 7 years, and its WACC…

A: Modified internal rate of return (MIRR) measures the attractiveness of an investment.It is used to…

Q: Project A costs $67,775, its expected net cash inflows are $10,000 per year for 10 years, and its…

A:

Q: What is the interest earned on a project that requires an initial investment of $ 10,000 and…

A: Initial investment (PV) = $ 10,000 Future value (FV) = $ 20,114 Period (n) = 5 Years

Q: What is the minimum annual revenue to make this project profitable

A: Given Cost = 379,968 annual operating cost = 167,365 project life = 10 years salvage cost = 12,887…

Q: A five-year project has an initial fixed asset investment of $280,000, an initial NWC investment of…

A: Equivalent Annual Cost (EAC) is the cost of owning an asset. It is used as an important tool for…

Q: A project has an initial cost of $45,000, expected net cash inflows of $13,000 per year for 11…

A: MIRR is a measure of a project’s profitability. It is a modified version of the IRR method where it…

Q: A project requires an initial investment of $170,000 and has a project profitability index of 0.350.…

A: Profitability Ratio The Profitability Index (PI) measures the ratio between the present value of…

Q: A project that provides annual cash flows of $11,200 for 20 years costs $175,000 today. What is the…

A: The profitability index can be calculated as the ratio of present value of cash inflows and initial…

Q: A project's annual revenues will be $5,881,947 the first year and will decrease by $81,248 per year…

A: First year revenue = $ 5,881,947 Annual decrease = $ 81,248 Life of project = 24 Effective interest…

Q: A project with a useful life of eight years requires an investment of $200,000 and yields after tax…

A: Income after tax = $ 30,000 Investment = $ 200,000

Q: Calculate the present value of $89,000 to be received in 15 years, assuming an opportunity cost of…

A: Present value is defined as the present discounted value in which an expected income stream value…

Q: Assume the following facts:• A project will cost $45,000 to develop.• When the system becomes…

A: Computation:

Q: A project has an initial cost of $40,000, expected net cash inflows of $9,000 per year for 7 years,…

A: The Internal rate of return is one of the capital budgeting method under which the projects are…

Q: A project has cost $50,000. The project is scheduled to complete three months from now and is…

A: Sunk cost is a cost which has already being incurred and cannot be recovered. For a continuing…

Q: A project will cost $10,000 up front and $1,000 each year thereafter. The project will bring in…

A: Breakeven point refers to the point at which total cost equals total revenue. The payback period is…

Q: Project L costs $59,583.76, its expected cash inflows are $13,000 per year for 10 years, and its…

A: IRR is the rate at which NPV of the project is 0

Q: What is the internal rate of return (IRR) of a project that costs $20,070 if it is expected to…

A: Internal rate of return is the return at which the present value of the project is zero. In other…

Q: A project has an initial cost of $50 000, net annual cash inflows of $20 000, and a $2 000 salvage…

A: Rate of return is the return on the profit on investment, It can change the value of investment,…

Q: Determine the average rate of return for a project that is estimated to yield total income of…

A:

Q: A project has an initial cost of $40,000, expected net cash inflows of $9,000per year for 7 years,…

A: NPV abbreviated as Net Present Value is the difference between the present value of cash inflows and…

Q: Determine the average rate of return for a project that is estimated to yield total income of…

A: Average rate of return = Average annual income / Initial investment where, Average annual income =…

Q: What is the equivalent annual cost for a project that requires a $50,000 investment at time-period…

A: Given, Initial Investment = $50,000 Annual Expense = $10,000 Opportunity cost = 10%

Q: Project L costs $45,041.68, its expected cash inflows are $10,000 per year for 9 years, and its WACC…

A: The internal rate of return refers to a metric used in capital budgeting for measuring…

Q: average rate of return for a project

A: Average annual income Total income/Number of years Total income $386,400 Number of years 4…

Q: A project with an initial cost of $65,700 is expected to generate annual cash flows of $17,570 for…

A: The internal rate of return (IRR) is a capital budgeting metric used to gauge the benefit of…

Q: An initial investment of $2,324,000 is expected to generate $600,000 per year for 6 years. Calculate…

A: Discounted Payback period = Year before the discounted payback period occurs + (cumulative cashflow…

Q: A project has an initial cost of $40,000, expected net cash inflows of $9,000 per year for 7 years,…

A: Solution:- We know, Net Present value (NPV) means the net present value of cash inflows after…

Q: Determine the average rate of return for a project that is estimated to yield total income of…

A: 1. Compute the estimated average annual income: Estimated average annual income=$484,4404…

Q: Determine the average rate of return for a project that is estimated to yield total income of…

A: Annaul income = Total income / Total years = $356,400/4 years = $89,100 Residual value = Operating…

Q: A project costs $100,000 and is expected to return profits of $15,000 per year. Calculate the…

A: Payback period: It is the time it takes for an investor's original investment to be repaid by cash…

Q: Project L costs $45,000, its expected cash inflows are $15,000 per year for 11 years, and its WACC…

A: The payback period refers to the time required by an investment to cover its initial investment.…

Q: The IRR of the project is 12% and the present value of operating cash flow is $22,000. The life of…

A: Financial breakeven is a point at which EPS of the company is equal to zero. It is a level before…

Q: Project L costs $54,779.63, its expected cash inflows are $13,000 per year for 8 years, and its WACC…

A: IRR is the rate at which NPV is zero

Q: Determine the average rate of return for a project that is estimated to yield total income of…

A: Average rate of return = Average Annual income / Initial investment where, Average Annual income =…

Q: Project L costs $65,000, its expected cash inflows are $8,000 per year for 9 years, and its WACC is…

A: IRR is the rate at which NPV is Zero

Q: For the following project, compute an EAA: Project A requires you an upfront payment of $262,782 and…

A: The equivalent annual annuity approach is the method of capital budgeting that evaluates the…

Q: Determine the average rate of return for a project that is estimated to yield total income of…

A: Calculate the average net income as follows: Average net income = Total income / Number of years…

Q: Determine the average rate of return for a project that is estimated to yield total income of…

A: Step 1 Average rate of return (ARR) is a return that  reflects the percentage rate of return…

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.