unity to expand the division by investing in additional machinery costing $430,000. He would depreciate the equipment using the​ straight-line method, and expects it to have no residual value. It has a useful life of 8 years. The firm mandates a required​ after-tax rate of return of 12​% on investments. Liam estimates annual net cash inflows for this investment of $110,000 before​ taxes, and an investment in working capital of $7,500. Tax rate is 30%. 1. Calculate the net present value of this investment. 2. Calculate the accrual accounting rate of return on initial investment for this project. 3. Should Liam accept the​ project? Will Liam accept the project if his bonus depends on achieving an accrual accounting rate of return of 12​%? How ca

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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.