Purchase Solution

# The Lazy Mower: Is It Really Worth It?

Not what you're looking for?

Using the second case study in the attachment I have a few questions:

Using the base case estimates calculate the cash, accounting, and financial breakeven of teh Lazy Mower Project. Interpret each one.

Let's say the company had spent \$500,000 in developing the prototype of the Lazy Mower. How should Dan and Ron treat this item in their report? Explain.

Calculate the IRR of the project. Based on your calculations what would you recommend and why?

##### Solution Summary

Calculation of Cash Break Even Point, Accounting Break Even Point and Financial Break Even Point of Lazy Mower Project.
Calculation of IRR.
The company had spent \$500,000 in developing the prototype of the Lazy Mower. How should Dan and Ron treat this item in their report? Explain.

Solution provided by:
###### Education
• Chartered Accountant (Equivalent to CPA in US), Institute of Charted Accountants of India
• Bachelor of Commerce, West Bengal University
###### Recent Feedback
• "I got this feedback and I wanted to know if you can explain it to me. I noticed something within your workings which I believe is incorrect.  It looks like you've mistaken the Debt ratio for the Equity Multiplier.  You've done a calculation to determine Return on Equity (ROE) but if you take a look at the ratios provided for us you'll see ROE listed on the bottom line already.  You can use ROE, Profit Margin and Total Asset Turnover to figure out the Equity Multiplier amount.  Equity multiplier is not provided for us and we need to calculate it.  I really hope this is helpful to you.  "
• "Very attentive to detail. Answers are designed in easy to understand format."
• "Fast response and thorough answer"
• "thank you very much! "
• "thank you so much !!!!!!!"

##### Introduction to Finance

This quiz test introductory finance topics.