Question
In: Finance
A project will produce an operating cash flow of $445,000 a year for four years. The...
A project will produce an operating cash flow of $445,000 a year for four years. The initial cash outlay for equipment will be $1,195,000. The net aftertax salvage value of $61,000 will be received at the end of the project. The project requires 87,000 of net working capital up front that will be fully recovered. What is the net present value of the project if the required rate of return is 12 percent? $146,800.23 $181,219.28 $154,036.37 $172,811.69 $163,677.13
Solutions
Expert Solution
Solution :
The net present value of the project if the required rate of return is 12 percent = $163,677.13
Thus the solution is option 5 = $ 163,677.13
Please find the attached screenshot of the excel sheet containing the detailed calculation for the solution.
jeff jeffy answered 3 months agoRelated Solutions
A project will produce an operating cash flow of $445,000 a year for four years. The...
A project will produce an operating cash flow of $445,000 a year
for four years. The initial cash outlay for equipment will be
$1,195,000. The net aftertax salvage value of $61,000 will be
received at the end of the project. The project requires 87,000 of
net working capital up front that will be fully recovered. What is
the net present value of the project if the required rate of return
is 12 percent? $146,800.23 $181,219.28 $154,036.37 $172,811.69
$163,677.13
A project will produce an operating cash flow of $15,200 a year for four years. The...
A project will produce an operating cash flow of $15,200 a year
for four years. The initial cash investment in the project will be
$50,000. The net after-tax salvage value is estimated at $4,000 and
will be received during the last year of the project’s life. What
is the internal rate of return for this project? Should the project
be accepted if the cost of capital is 10%?
Group of answer choices
8.31%; No, project should be rejected
10.81%; Yes,...
A project will produce an operating cash flow of $295,000 a year for four years. The...
A project will produce an operating cash flow of $295,000 a year
for four years. The initial cash outlay for equipment will be
$721,000. The net aftertax salvage value of $72,000 will be
received at the end of the project. The project requires $79,000 of
net working capital that will be fully recovered when the project
ends. What is the net present value of the project if the required
rate of return is 15 percent?
$114,372
$121,017
$128,553
$136,764
$144,915
A project will produce an operating cash flow of $91,500 a year for three years. The...
A project will produce an operating cash flow of $91,500 a year
for three years. The initial cash outlay for
equipment will be $188,000. The net aftertax salvage value of
$17,000 will be received at the end of the
project. The project requires $52,000 of net working capital up
front that will be fully recovered. What is the
net present value of the project if the required rate of return
is 14 percent?
A. $22,318.76 B. $19,002.37 C. $15,450.93 D....
A project will produce an operating cash flow of $7,300 a year for three years. The...
A project will produce an operating cash flow of $7,300 a year
for three years. The initial investment for fixed assets will be
$11,600, which will be depreciated straight-line to zero over the
asset's 4-year life. Ignore bonus depreciation. The project will
require an initial $500 in net working capital plus an additional
$500 every year with all net working capital levels restored to
their original levels when the project ends. The fixed assets can
be sold for an estimated...
A project will produce cash inflows of $1,750 a year for four years. The project initially...
A project will produce cash inflows of $1,750 a year for four
years. The project initially costs $10,600 to get started. In year
five, the project will be closed and as a result should produce a
cash inflow of $8,500. What is the net present value of this
project if the required rate of return is 14.75%?
-$1,306.18
-$935.56
$5,474.76
$1,011.40
4-A project will produce cash inflows of $1,750 a year for four years. The project initially...
4-A project will produce cash inflows of $1,750
a year for four years. The project initially costs $10,600 to get
started. In year five, the project will be closed and as a result
should produce a cash inflow of $8,500. What is the net present
value of this project if the required rate of return is 13.75%?
5-What is the net present value of a project that has an initial
cash outflow of $-11,500, at time 0, and the following...
Dorel Industries is considering an investment project that will produce an operating cash flow of $407,000...
Dorel Industries is considering an investment project that will
produce an operating cash flow of $407,000 a year for five years.
The initial cash outlay for equipment will be $1,318,000. An
aftertax salvage value of $105,440 for the equipment will be
received at the end of the project. The project requires $197,000
of net working capital that will be fully recovered. What is the
net present value of the project if the required rate of return is
14 percent?
$98,043.66...
USP Company is considering an investment project that will produce an operating cash flow of $94,000...
USP Company is considering an investment project that will
produce an operating cash flow of $94,000 a year for three years.
The initial cash outlay for equipment will be $201,000. The net
aftertax salvage value of $17,000 will be received at the end of
the project. The project requires $32,500 of net working capital up
front that will be fully recovered when the project ends. What is
the net present value of the project if the required rate of return...
Initial Cash flow investment Project A $5 million $2 million per year for four years Project...
Initial Cash flow
investment
Project A $5 million $2 million per year for
four years
Project B $3 million $1 million per year for five
years
Project C $2 million $1 million per year for four
years
Project D $3 million $1.5 million per year for
three years
An investor has a budget of $5 million. He can invest in the
projects shown above. If the cost of capital is 6%, what investment
or investments should he make?
Select one:...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- 3) You are rolling a 12 sided die 8 times. a) What is the size for...
- explain the difference between quantitative and qualitative research strategies. Provide an example of a crime based...
- use postorder and inorder tree traversals to make preorder traversal. #!/usr/bin/env python3 # encoding: UTF-8 """Turning...
- 1. Write an if-else statement to describe an object. Print "Balloon" if isBalloon is true and...
- An investor is considering purchasing a Treasury bond with a 20 year maturity, an 8% coupon...
- Write a program that copies the contents of one file to a destination file. This program...
- how to conduct a marketing mix for 3d crest white strips
ADVERTISEMENT