If Company XYZ plans to invest in a project with initial capital outlay $52,125, annual net...

If Company XYZ plans to invest in a project with initial capital outlay $52,125, annual net cash inflow $12,000 for 8 years, and discount rate 12%, what is the Company XYZ’s NPA, IRR, MIRR, Payback period, and Discounted Payback Period?

Expert Solution

jeff jeffy answered 3 years ago

XYZ is considering a 3-yr project. The initial outlay is $120,000, annual cash flow is $50,000...

XYZ is considering a 3-yr project. The initial outlay is $120,000, annual cash flow is $50,000 and the terminal cash flow is $10,000. The required rate of return (cost of capital) is 15%. The net present value is $736.42. What if the required rate of return is 9% instead? Re-calculate the NPV.

Question N1 - XYZ is considering a 3-yr project. The initial outlay is $120,000, annual cash...

Question N1 - XYZ is considering a 3-yr project. The initial outlay is $120,000, annual cash flow is $50,000 and the terminal cash flow is $10,000. The required rate of return (cost of capital) is 15%. The net present value is $736.42. What if the annual cash flow increases to $57,000 instead? Re-calculate the NPV. Question N2 - Six years ago, XYZ Company invested $51,959 in a new machinery. The investment in net working capital was $4,716 which would be...

XYZ is considering a 3-yr project. The initial outlay is -$120,000, annual cash flow is $50,000...

XYZ is considering a 3-yr project. The initial outlay is -$120,000, annual cash flow is $50,000 and the terminal cash flow is $10,000. The required rate of return (cost of capital) is 15%. The net present value is $736.42. What if the annual cash flow increases to $54,000 instead? Re-calculate the NPV.

6. A project requires initial capital outlay of GH₡300,000. The project will provide annual cash flow...

6. A project requires initial capital outlay of GH₡300,000. The project will provide annual cash flow of GH₡80,000 for 5 years. what is the payback period? * Your answer

Net Present Value An organization’s initial outlay for a proposed capital budgeting project is $1,000,000. Use...

Net Present Value An organization’s initial outlay for a proposed capital budgeting project is $1,000,000. Use the table below to calculate the net present value. Free Cash Flows Year Amount Year Amount 1 $250,000.00 4 $310,000.00 2 $60,000.00 5 $75,000.00 3 $0.00 6 $380,000.00 You are the CEO of the company. If the firm’s cost of capital is 8%, how likely would you be to approve this project when the net present value is $1.00? Would you be more or...

1) A company invests in a new project that requires an initial capital outlay of $852790....

1) A company invests in a new project that requires an initial capital outlay of $852790. The project will generate annual net cash flows of $145612 over a period of 8 years. The after-tax cost of capital is 9%. In addition, a working capital outlay of $94620 will be required. This working capital outlay will be recovered at the end of the project’s life. What is the net present value of the project? Select one: a. $-141474 b. $-93987 c....

A project has an initial cost of $52,125, expected net cash inflows of $12,000 per year...

A project has an initial cost of $52,125, expected net cash inflows of $12,000 per year for 7 years, and a cost of capital of 12%. What is the project's discounted payback period? (Hint: Begin by constructing a time line.) Do not round intermediate calculations. Round your answer to two decimal places.

A project has an initial outlay of $2,378. The project will generate annual cash flows of...

A project has an initial outlay of $2,378. The project will generate annual cash flows of $660 over the 4-year life of the project and terminal cash flows of $202 in the last year of the project. If the required rate of return on the project is 13%, what is the net present value (NPV) of the project? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box.

Cox Healthcare Clinic is evaluating a Capital Budgeting project that costs $52,125 and has expected net...

Cox Healthcare Clinic is evaluating a Capital Budgeting project that costs $52,125 and has expected net cash flows of $12,000 per year for eight years. The first inflows occur one year after the cost outflow and the project has a cost of capital of 12 percent. Below is a table of cash flows for the Capital Budget project: Year Annual Cash Flow Cumulative Cash Flow 0 -$52,125 -$52,125 1 $12,000 -$40,125 2 $12,000 -$28,125 3 $12,000 -$16,125 4 $12,000 -$4,125...

Healthcare Clinic is evaluating a Capital Budgeting project that costs $52,125 and has expected net cash...

Healthcare Clinic is evaluating a Capital Budgeting project that costs $52,125 and has expected net cash flows of $12,000 per year for eight years. The first inflows occur one year after the cost outflow and the project has a cost of capital of 12 percent. Below is a table of cash flows for the Capital Budget project: Year Annual Cash Flow Cumulative Cash Flow 0 -$52,125 -$52,125 1 $12,000 -$40,125 2 $12,000 -$28,125 3 $12,000 -$16,125 4 $12,000 -$4,125 5...

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