An old two-flat can be purchased for $200,000 cash. The two units can bring in a total of $2,500 per month (allowing for normal vacancies). The total operating expenses for property taxes, repairs, gardening, and so forth are estimated to be $200 per month. For tax purposes, straight-line depreciation over a 20-year remaining life with to a zero salvage value will be used.

Of the total $200,000 cost of the property, $50,000 is the value of the land. Assume a 38% marginal income tax bracket (combined state and federal taxes) applies throughout the 20 years. This tax rate applies to ordinary income and capital gains/losses.

Since there is no growth expected in rents or expenses, depreciation is straight-line, and the tax rate doesn’t change, the ATCF’s for each year, 1 to 20, will be the same.

1a.

What after-tax IRR would you expect assuming that the property is held for twenty years and then sold for $50,000?

1b.

What after-tax IRR would you expect assuming that the property is held for twenty years and then sold for $150,000?

Do not use excel

Geraldine Wolfe is a supervisor at Fantastigifts. She has an annual salary of $45,500, paid biweekly, and a garnishment for consumer credit of $435. Assuming that her disposable income is 80 percent of her gross pay per period, does the garnishment follow the CCPA? If not, what is the maximum garnishment allowed for Geraldine’s consumer credit garnishment? (Round your intermediate calculations and final answer to 2 decimal places.)

1. Does the garnishment follows the CCPA?

2. Maximum garnishment allowed:

The following payments are made under an annuity: 12 at the end of the 44th year, 11 at the end of the 55th year, decreasing by 11 each year until nothing is paid. Find the present value if the annual effective rate of interest is 3%.

Fuzzy Restaurant is considering the purchase of a $1,500,000 flat top grill. The grill has an economic life of 8 years and will be fully depreciated using straight line method. The grill is expected to produce 59,000 tacos per year for the next 8 years, with each costing $1.50 to make and priced at $5. Assume the discount rate is 8% and the tax rate is 21%. The restaurant expects the market value of the grill to be $200,000, 8 years from now. Calculate the book value of the grill at the end of year 5. (Round to 2 decimals) Calculate the operating cash flow at the end of year 1. Calculate the net present value.

Assume that you purchased a share of the Company at the beginning of 2018 for $54.58. One year later the stock was worth $53.53, but during 2018 you received a cash dividend of $2.32

Calculate the following:

1. Income

2. Capital gain (loss)

3. Total return – a. in dollars; b. as a percent

Finco Inc. manufactures financial calculators. The company is deciding whether to introduce a new calculator. This calculator will sell for $85. The company feels that sales will be 13,500, 13,900, 14,000, 14,200, and 13,000 units per year for the next 5 years. Variable costs will be 30% of sales, and fixed costs are $250,000 per year. The firm hired a marketing team to analyze the viability of the product and the marketing analysis cost $1,000,000. The company plans to use a vacant warehouse to manufacture and store the financial calculators. Based on a recent appraisal the warehouse and the property is worth $2.2 million on an after tax basis. If the company does not sell the property today then it will sell the property 5 years from today at the currently appraised value. This project will require an injection of net working capital at the on set of the project in the amount of $50,000. This net working capital will be fully recovered at the end of the project. The firm will need to purchase some equipment in the amount of $500,000 to produce the new calculators. The machine has a 7 year life and will be depreciated using the straight-line method. At the end of the project, the anticipated market value of the machine is $150,000. The firm requires an 8% return on its investment and has a tax rate of 21%. 1.Calculate the sunk cost of the project. (Enter a positive value and round to the nearest dollar) 2.Calculate the opportunity cost of the project. (Enter a positive value and round to the nearest dollar) 3.Calculate the net working capital injection at the beginning of the project. (Enter a positive value and round to the nearest dollar) 4.Calculate the book value of the machine at the end of year 5. (Round to two decimals) 5.Calculate the depreciation expense at the end of year 2. (Round to two decimals) 6.Calculate the after tax salvage value at the end of year 5. (Round to two decimals) 7.Calculate the operating cash flows at the end of year 1. (Round to two decimals) 8.Calculate the initial cash outflow (e.g. the time 0 cash flow). (Enter a negative value and round to two decimals) 9.Calculate the cash flow from assets at the end of year 5. (Round to two decimals) 10.Calculate the net present value for the project. (Round to 2 decimals)

The Campbell Company is considering adding a robotic paint sprayer to its production line. The sprayer's base price is $870,000, and it would cost another $20,000 to install it. The machine falls into the MACRS 3-year class (the applicable MACRS depreciation rates are 33.33%, 44.45%, 14.81%, and 7.41%), and it would be sold after 3 years for $566,000. The machine would require an increase in net working capital (inventory) of $18,500. The sprayer would not change revenues, but it is expected to save the firm $392,000 per year in before-tax operating costs, mainly labor. Campbell's marginal tax rate is 30%. Cash outflows, if any, should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to the nearest dollar.

1. What is the Year-0 net cash flow?

   $   

2. What are the net operating cash flows in Years 1, 2, and 3?

   Year 1:	$
   Year 2:	$
   Year 3:	$

3. What is the additional Year 3 cash flow (i.e, the after-tax salvage and the return of working capital)?

   $   

4. If the project's cost of capital is 10 %, what is the NPV of the project?

   $   

   Should the machine be purchased?

Do you think the stock market is rational? Why or why not? Requirement: 150 words or more

our pro forma income statement shows sales of $ 991 comma 000$991,000​, cost of goods sold as $ 510 comma 000$510,000​, depreciation expense of $ 99 comma 000$99,000​, and taxes of $ 152 comma 800$152,800 due to a tax rate of 40 %40%. What are your pro forma​ earnings? What is your pro forma free cash​ flow? Complete the pro forma income statement​ below:  ​(Round to the nearest​ dollar.) Sales $ Cost of Goods Sold $ Gross Profit $ Depreciation $ EBIT $ Taxes (40%) $ Earnings $

Excel work, please

Assume that a lender offers a 30-year, $150,000 adjustable rate mortgage (ARM) with the following terms: Initial interest rate = 7.5 percent Index = one-year Treasuries Payments reset each year Margin = 2 percent Interest rate cap = 1 percent annually; 3 percent lifetime Discount points = 2 percent Fully amortizing; however, negative amortization allowed if interest rate caps reached Based on estimated forward rates, the index to which the ARM is tied is forecasted as follows: Beginning of year (BOY) 2 = 7 percent; (BOY) 3 = 8.5 percent; (BOY) 4 = 9.5 percent; (EOY) 5 = 11 percent. Compute the payments, loan balances, and yield for the ARM for the five-year period.

Dinklage Corp. has 6 million shares of common stock outstanding. The current share price is $85, and the book value per share is $8. The company also has two bond issues outstanding. The first bond issue has a face value of $65 million, a coupon rate of 8 percent, and sells for 95 percent of par. The second issue has a face value of $40 million, a coupon rate of 9 percent, and sells for 108 percent of par. The first issue matures in 23 years, the second in 5 years.

Suppose the most recent dividend was $5.70 and the dividend growth rate is 4 percent. Assume that the overall cost of debt is the weighted average of that implied by the two outstanding debt issues. Both bonds make semiannual payments. The tax rate is 38 percent. What is the company’s WACC? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

What is the price of a money market security with a discount yield of 5.38%, 145 days to maturity, and a $1000 face value? Round to $0.01.

One year​ ago, your company purchased a machine used in manufacturing for $95,000.You have learned that a new machine is available that offers many advantages and you can purchase it for $170,000 today. It will be depreciated on a​ straight-line basis over 10 years and has no salvage value. You expect that the new machine will produce a gross margin​ (revenues minus operating expenses other than​ depreciation) of $50,000 per year for the next 10 years. The current machine is expected to produce a gross margin of $22,000 per year. The current machine is being depreciated on a​ straight-line basis over a useful life of 11​ years, and has no salvage​ value, so depreciation expense for the current machine is $8,636 per year. The market value today of the current machine is $60,000. Your​ company's tax rate is 38 %​, and the opportunity cost of capital for this type of equipment is 12 %.Should your company replace its​ year-old machine?

The NPV of replacing the​ year-old machine is ​? (round to nearest dollar)