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Capital Budgeting

Topic = The pros and cons of static and flexible budgets - instructions below

Introduction: This section will discuss your topic and the purpose of the paper. You will clearly state the problem, issue of concern/interest, or area(s) the paper is seeking to address. Body of Paper: You will use the internet/online library resources to research material to support your paper. You will find a lot of

Answer to student's question about: Capital Budgeting

A firm with a 14 percent WACC is evaluating two projects for this year's capital budget. After-tax cash flows, including depreciation, are as follows: 0 1 2 3 4 5 Project A -6,000 2,000 2,000 2,000 2,000 2,000 Project B -18,000 5,600 5,6

Basic Net Present Value Analysis is achieved.

Renfree Mines, Inc., owns the mining rights to a large tract of land in a mountainous area. The tract contains a mineral deposit that the company believes might be commercially attractive to mine and sell. An engineering and cost analysis has been made, and it is expected that the following cash flows would be associated with op

Net present value with no residual value is determined.

Florence is contemplating the purchase of a soda machine, which will be used to sell soft drinks to customers for $.75 each. The following estimates are available: Initial outlay $3,500 Annual cash inflow $1,000 Cost of capital 10% Estimated life

Capital budgeting

I need help with the following issues: how to calculate the net present value and the dollar value per year attach to the intangible benefits? "I am not sure we should lay out $500,000 for that automated welding machine", said JA president of SEC. "That's a lot of money, and it would cost us $80,000 for software and installat

Finance: NPV, IRR, Payback

You have two projects. You must calculate the NPV, IRR, and payback for both. These projects may be made up and very simplified but must show numerical examples. Explain the value of NPR, IRR and payback. Of the two projects you've created, which project would you invest in if the projects were mutually exclusive versus independ

To Hot to Handle: Case Study - Capital Budgeting

See the case file attached. Exhibit 1 Some Relevant Information Salon Hours: Sunday, Monday Closed Tues-Thurs 9am - 7pm Fri 9am - 5pm Sat 9am - 2pm Advertising Costs $300 per month (Yellow Pages Ad) $200 per month (other advertisements) Patsy's After-tax cost of funds: 11% per year Depreciation method: Straight line

Silicon Arts: Risk Analysis on Investment Decision Simulation

See attached file for simulation. After completing the Capital Budgeting simulation, prepare an APA paper analyzing the risks associated with your investment decision. Included in the analysis of risk should be a mitigation plan for each risk discussed. Focus on concepts learned and applied in the exercise and present the


Write a 3-4 page paper that discusses at least one capital project your organization has taken on. If you cannot find this information, discuss what project or projects you think your organization should take on. Be sure to include a discussion of projected financial costs and benefits. You may use the break-even analysis if

Study Questions for Financial Management

See the attached file for problems. FINANCIAL MANAGEMENT STUDY QUESTIONS 1. Current Ratio: How would the following actions affect a firm's current ratio? a. Inventory is sold at cost. b. The firm takes out a bank loan to pay its accounts due. c. A customer pays its accounts receivable. d. The firm uses cash to purchase a

Finance: Evalulate Proposals, Payback, NPV, IRR, Optimal Capital

A firm is evaluating a proposal which has an initial investment of $35,000 and has cash flows of $10,000 in year 1, $20,000 in year 2, and $10,000 in year 3. The payback period of the project is A) 1 year. B) 2 years. C) between 1 and 2 years. D) between 2 and 3 years. -- From the informatio

Equipment purchases: initial investment, cash flow, payback period, NPV

Please help with the following question and show all your work. 1. You have been asked by the President of your company to evaluate the proposed acquisition of a new special-purpose truck. The truck's basic price is $60,000. The truck falls into the four year class using straight line depreciation method, and it will be sold

Key Principles of Financial Managements

You have recently been appointed as the senior management accountant in a large listed company, XYZ plc which has divisions in a number of countries and trades globally. You have examined the financial management procedures of XYZ plc and have had discussions with the board of directors of the company. In doing so you have i

XYZ Co new machine: determine initial investment, payback period, NPV, IRR, MIRR

XYZ Co. is considering the purchase of a new machine. The machine will cost $250,000 and requires installation costs of $25,000. The existing machine can be sold currently for $25,070. It was purchased three years ago for $83,000 and depreciated using MACRS (you can find the table in the D.Sharing) for five years. It can be oper

NPV, Equivalent Units for Materials & Relevant Cost Questions

1. (TCO F) Loxham Corporation uses the weighted-average method in its process costing system. Data concerning the first processing department for the most recent month are listed below: Work in process, beginning: Units in beginning work in process inventory

Finance Case: Calculate WACC, NPV, PI, IRR and MIRR

See also enclosed Word document of the case study and excel spreadsheet for the financial exibit. Please help answer all questions. The Investment Detective The essence of capital budgeting and resource allocation is a search for good investments in which to place the firm's capital. The process can be simple when viewed i

Company A, Company B: Calculate ROI and residual income for each

The overall sales and operating data for two different companies are given below: Company A Company B Sales $ 6,000,000 $ 8,000,000 Average Operating Assets $ 1,500,000 $ 2,000,000 Net Operating Profit $ 400,000 $ 200,000 Stockholders' Equity $ 1,000,000 $ 1,500,000 Each firm's minimum rat

NPV: Calculate the investment rate of return and its NPV.

The following information is available about an investment opportunity. Investment will occur at time 0 and sales will commence at time 1. Initial cost $10 million Unit sales 100,000 Selling price per unit, this year $50 Variable cost per unit, this year $20 L

Two alternatives 28

Question 28: (2 points) (Ignore income taxes in this problem.) Morrel University has a small shuttle bus that is in poor mechanical condition. The bus can be either overhauled now or replaced with a new shuttle bus. The following data have been gathered concerning these two alternatives: Present Bus New Bus Purchase c

Corporate Finance Multiple Choice Questions

Can you help me get started on these problems? 3) A $120,000.00 investment will pay $34,883.50 year one, $43,604.37 year two, $34,883.50 year three, $17,441.75 year four, and $8,720.87 year five, what is the IRR ? [a] 6.25% [b] 6.50% [c] 6.75% [d] 7.00% [e] 7.25% Hint: The necessary formula is IRR =

Finance Capital Budgeting

Can someone help with the following question? The following is stream of expect cash flows from a project to replace an old sail boat with a new one. The new boat will cost $15,000 and will be good for 5 years. It will be traded-in for another boat at the end of its useful life. The following cash flows are expected: Ye