Share
Explore BrainMass

Net Present Value (NPV)

CASH FLOWS AND NPV

Johnny's Lunches is considering purchasing a new, energy-efficient grill. The grill will cost $20,000 and will be depreciated in an asset class which carries a CCA rate of 30 percent. It will be sold for scrap metal after 3 years for $5,000. The grill will have no effect on revenues but will save Johnny's $10,000 in energy expen

Present value

The present worth of $5,000 in year 3, $10,000 in year 5, and $10,000 in year 8 at an interest rate of 12% per year is closest to? a. 12,100 b. 13,300 c. 14,900 d. 16,200

Capital Budgeting

Vulture Partners, a private equity organization specializing in distressed company investing, was interested in purchasing a company called Turnaround. Mr. Fang, a general partner at Vulture, made the following projections to value Turnaround ($mm): Year 1 Year 2 Year 3 Year 4 Year 5 Revenue 200 210 220 230 240 Costs

Net Present Value

Please show the computations for all four. This is everything that I have for this question. What is the Net Present Value of the following cash flow? 60 monthly payments in arrears of $1855.00 at 5 percent. Discounted at: a. 100,000 b. 1,000,000 c. 57,879 d. 98,292

Capital budgeting criteria

Please discuss the following three questions. 1. Which decision-making criteria is the best to use for capital budgeting decisions? Why? 2. How can risk be addressed in the capital budgeting process? 3. When is it preferable to lease, as opposed to purchase, capital assets?

Compute and analyze financial equations

I'm stuck on calculating the Discounted Payback Period and Modified Internal Rate of Return. Would you please figure them for me? The problem is: Your Company is thinking of acquiring another corporation.You have two choices; the cost of each choice is $250,000. You cannot spend more than that, so acquiring both corporations is

Financial management - operating cash flow, Breakeven quantity, EPS

1. Operating cash flow - Eisenhower Communications is trying to estimate the first-year operating cash flow (at T=1) for a proposed project. The financial staff has collected the following information: Projected sales $10 million Operating costs (excluding depreciation) 7 million Depreciation 2 million I

Calculate cash flows and net present value for equipment purchase.

Need to know how you calculate net present value and also cash flows. Equipment/ Fixtures cost: $200,000 and will be depreciated over 5 years to $0. Need to increase its net working capital by $200,00 at time 0. First year sales $1million and increase at an annual rate of %8 over 10 years, Operating expenses are $700,000 d

1-2 page requirement-Management Accounting -Horngren

Deliverable Length: 1-2 pages Deer Valley Lodge, a ski resort in the Wasatch Mountains of Utah, has plans to eventually add five new chairlifts. Suppose that one lift costs $2 million, and preparing the slope and installing the lift costs another $1.3 million. The lift will allow 300 additional skiers on the slopes, but there a

Financial management

Please assist me with the following problems ... Multiple Choice (also attached) 1. The following data is associated with a proposed new project: The initial cost of the project is estimated to be $15,000; the project's estimated life is 5 years; depreciation is based on a five-year straight line method; there will be ini

Calculate Net Present Value before and after tax of an investment

In considering an investment, the cost of new equipment is $2 million each and installation is $1.3 million each. The company is considering purchasing 5 units. This purchase will allow service to 300 more customers, but the additional services are only needed 40 days a year. The cost to run extra equipment will be $500 per day

Cash In

Please see PC43302 for the details of the questions. Can you please make sure I will also have overview of cash in, cash out, non cash in, non cash out etc. as the answers need to show the path/way use to get to the answer.

Corporate Finance: 15 MC questions, need solution,

1. You have the following data for the Fosberg Winery. What is Fosberg's return on assets (ROA) ? Return on equity = 15%; Earnings before taxes = $30,000; Total asset turnover = 0.80; Profit margin = 4.5%; Tax rate = 35%. A) 3.6% B) 3.9% C) 5.7% D) 6.4% E) 9.3% 2. Given the following information, what is the v

Net Present Value of project for Golden Gelt Giftware.

Project evaluation: The following table presents sales forecasts for Golden Gelt Giftware. The unit price is $40.00. The unit cost of the giftware is $25.00. Year Unit Sales 1 $22,000.00 2 $30,000.00 3 $14,000.00 4 $5,000.00 th

New Product Development

Senior management is considering two proposals to expand the product line. Expansion of the product line requires a new facility and production team. Senior management hired a consulting firm to research the potential product lines. Lava Rocks would like to make this product line for at least 5 years (so the evaluation is for 5

Corporate Finance Canadian

Draw ALL timelines and label them clearly ALL problems should be done by hand. If you wish to type them out, all formulas, calculations and equations must be shown Question # 1 Filkins Fabric Company (FFC) needs to provide 8,300 shirts each year to a local organization in Toronto for summer events for the next eight years

NPV, risk-adjusted discount rate, unlevered beta, cost of debt, cost of equity

Problems (also attached): 1. The Saltinero Company is considering two investments (data attached). The firm's cost of capital Is 12% and the risk-free rate is 7%. A. Compute the NPV of the 2 investments using the firm's cost of capital. Identify the preferred investment. B. Compute the NPV of the 2 investments using the

Operations Management: Control Charts, p chart, X bar chart, R chart, c chart, Demand, Present Value, EMV, expected value under certainty, expected value of perfect information, Linear Programming,

1. A state department of tourism and recreation collects data on the number of cars with out-of-state license plates in a state park. (The group's position is that more out-of-state plates means the state's advertising programs are working.) The sample size is fixed at n=100 each day. Data from the previous 20 days indicate the

8-16. NPV and IRR

8-16. NPV and IRR. Cuchia Company is presented with the following two mutually exclusive projects. The required return for both projects is 15 percent. Year Project M Project N 0 -$35,000 -$420,000 1 10,000 180,000 2 21,000 200,000 3 15,000 170,000 4 14,000 110,000

Evaluating a Salinger Project using WAAC and NPV

Please help with the following problem. WACC and NPV. Sallinger, Inc., is considering a project that will result in initial aftertax cash savings of $6 million at the end of the first year, and these savings will grow at a rate of 4 percent per year indefinitely. The firm has a target debt-equity ratio of .7, a cost of equit

Calculating net investment, net cash flows and net present value

1. Find the Net Investment for both options. Which option is more attractive based solely on this evaluation? 2. Calculate the Net Cash Flows for both options. Which option is more attractive based solely on this evaluation? 3. Briefly explain the reasons for any difference in your answer in question 1 and question 2 or why bo

Annual After Tax Cash Flow; Net Present Value of Purchase

Use the following to answer questions 1-2: Paige, Inc. is considering the purchase of a new machine costing $480,000. The machine's useful life is expected to be 8 years with no salvage value. The straight-line depreciation method will be used. The net increase in annual after tax cash flow is expected to be $110,000. Paige est

Finance Problem

I'm taking courses online and I am having trouble with some of the questions. We have these exams each week and the instructor gives us sample questions to complete, then hands out the exam at the end of the week and we have a time frame that we neeed to complete it. I was hoping you could answer the practice questions and show

NPV of a Proposed Project With 3 Years Estimated Life

Given the following information, calculate the NPV of a proposed project: Cost = $4,000; estimated life = 3 years; initial decrease in accounts receivable = $1,000, which must be restored at the end of the project's life; estimated salvage value = $1,000; earnings before taxes and depreciation = $2,000 per year; method of deprec

Problem

Which of the following statements is incorrect? a. Assuming a project has normal cash flows, the NPV will be positive if the IRR is less than the cost of capital. b. If the multiple IRR problem does not exist, any independent project acceptable by the NPV method will also be acceptable by the IRR method. c. If IRR = k

Problem

If a company uses the same discount rate for evaluating all projects, which of the following results is likely? a. Accepting poor, high risk projects. b. Rejecting good, low risk projects c. Accepting only good, low risk projects. d. Accepting no projects e. Statements a and b are correct.