Question
In: Finance
The Sisyphean Company is planning on investing in a new project. This will involve the purchase...
The Sisyphean Company is planning on investing in a new project. This will involve the purchase of some new machinery costing $450,000. The Sisyphean Company expects cash inflows from this project as detailed below:
|
Year One |
Year Two |
Year Three |
Year Four |
|
$200,000 |
$225,000 |
$275,000 |
$200,000 |
The appropriate discount rate for this project is 16%.
The NPV for this project is closest to:
Solutions
Expert Solution
| The NPV for this project is closest to $176,264.53 | ||||
| Statement showing Cash flows | ||||
| Particulars | Time | PVf 16% | Amount | PV |
| Cash Outflows | - | 1.00 | (450,000.00) | (450,000.00) |
| PV of Cash outflows = PVCO | (450,000.00) | |||
| Cash inflows | 1.00 | 0.8621 | 200,000.00 | 172,413.79 |
| Cash inflows | 2.00 | 0.7432 | 225,000.00 | 167,211.65 |
| Cash inflows | 3.00 | 0.6407 | 275,000.00 | 176,180.86 |
| Cash inflows | 4.00 | 0.5523 | 200,000.00 | 110,458.22 |
| PV of Cash Inflows =PVCI | 626,264.53 | |||
| NPV= PVCI - PVCO | 176,264.53 | |||
jeff jeffy answered 1 year agoRelated Solutions
The Sisyphean Company is planning on investing in a new project. This will involve the purchase...
The Sisyphean Company is planning on investing in a new project.
This will involve the purchase of some new machinery costing $ 350
comma 000. The Sisyphean Company expects cash inflows from this
project as detailed below: Year 1 Year 2 Year 3 Year 4 $ 150 comma
850 $ 150 comma 850 $ 150 comma 850 $ 150 comma 850 The appropriate
discount rate for this project is 15%. The internal rate of
return (IRR) for this project is...
Company is planning on investing in a new project. This will involve the purchase of some...
Company is planning on investing in a new project. This will
involve the purchase of some new machinery costing $450,000. The
company expect cash inflows from this project as detailed
below:
Year One Year Two Year Three Year Four
$200,000 $225,000 $275,000 $200,000
The appropriate discount rate for this project is 12%.
The discounted payback period for this project is closest
to:
Answer
2.1 years
3 years
2.0 years
2.5 years
The Gamma Company is planning on investing in a new project. This project requires an initial...
The Gamma Company is planning on investing in a new project.
This project requires an initial investment into a new machinery of
$420,000. The Gamma Company expects cash inflows from this project
to be as follows: $200,000 in year 1, $225,000 in year 2, $275,000
in year 3, and $200,000 in year 4 of the project. If the
appropriate discount rate for this project is 16% then the NPV of
the project is closest to _____________________.
Group of answer choices...
The Gamma Company is planning on investing in a new project. This project requires an initial...
The Gamma Company is planning on investing in a new project.
This project requires an initial investment into a new machinery of
$420,000. The Gamma Company expects cash inflows from this project
to be as follows: $200,000 in year 1, $225,000 in year 2, $275,000
in year 3, and $200,000 in year 4 of the project. The appropriate
discount rate for this project is estimated at 16%. What is the IRR
of this project?
Group of answer choices
31.2%
26.7%...
The Sisyphean Corporation is considering investing in a new machine that has an estimated life of...
The Sisyphean Corporation is considering investing in a new
machine that has an estimated life of three years. The cost of the
machine is $50,000 and the machine will be depreciated straight
line over its three-year life to a residual value of $0. The
machine will result in sales of 3,000 widgets in year 1. Sales are
estimated to grow by 10% per year each year through year three. The
price per widget that Sisyphean will charge its customers is...
: The Sisyphean Corporation is considering investing in a new cane manufacturing machine that has an...
: The Sisyphean Corporation is considering
investing in a new cane manufacturing machine that has an estimated
life of three years. The cost of the machine is $30,000 and the
machine will be depreciated straight line over its three-year life
to a residual value of $0.
The cane manufacturing machine will result in sales of 2400
canes in year 1. Sales are estimated to grow by 9% each year
through year 3. The price per cane that Sisyphean will charge...
The Sisyphean Corporation is considering investing in a new cane manufacturing machine that has an estimated...
The Sisyphean Corporation is considering investing in a new cane
manufacturing machine that has an estimated life of three years.
The cost of the machine is $30,000 and the machine will be
depreciated straight line over its three-year life to a residual
value of $0.
The cane manufacturing machine will result in sales of 2000 canes
in year 1. Sales are estimated to grow by 10% per year each year
through year three. The price per cane that Sisyphean will...
The Sisyphean Corporation is considering investing in a new cane manufacturing machine that has an estimated...
The Sisyphean Corporation is considering investing in a new cane
manufacturing machine that has an estimated life of four years. The
cost of the machine is $40,000 and the machine will be depreciated
straight line over its four-year life to a residual value of $0.
The cane manufacturing machine will result in sales of 2,000 canes
in year 1. Sales are estimated to grow by 10% per year each year
through year four. The price per cane that Sisyphean will...
The Sisyphean Corporation is considering investing in a new cane manufacturing machine that has an estimated...
The Sisyphean Corporation is considering investing in a new cane
manufacturing machine that has an estimated life of three years.
The cost of the machine is $30,000. It will be depreciated 20% in
year 1, 32% in year 2, and 19% in year 3. The machine will be sold
for $15,000 in year 3.
The machine will result in sales of 2000 canes in year 1. Unit
sales are estimated to grow by 10% per year through year three.
Each...
ABC, Inc is planning the purchase of new equipment that costs $149,331. The project is expected...
ABC, Inc is planning the purchase of new equipment that costs
$149,331. The project is expected to last for 14 years. Each year,
the new project is expected to sell 103 units for $480 per unit.
The variable costs are expected to $50 per unit and the fixed costs
are expected to be $23,038. The equipment will be depreciated on a
straight-line basis over the 14-year life of the project. That is,
the depreciation each year will be $149,331/14. Assuming...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- The correlation between X and Y ______________. Question options: measures the variation around the predicted regression...
- Will iron(III) hydroxide precipitate from a pH = 1.00 solution with [Fe3+] = 1.0 x 10-5?...
- What do you believe happens during the final scene of the story between the brothers at....
- A 5.171 g sample of a solid, weak, monoprotic acid is used to make a 100.0...
- 1. Creep is one of deformation that occurred in concrete structure. Give one example that can...
- Why does a particular codon represent only one specific amino acid?
- Write a function template sort that takes two references to generic objects and switches them if...
ADVERTISEMENT