Question
In: Finance
Project 1 Initial $ 120,000.00 Investment Cost of Capital 9% Target Payback 4 years Period Cash...
| Project 1 | ||
| Initial | $ 120,000.00 | |
| Investment | ||
| Cost of Capital | 9% | |
| Target Payback | 4 years | |
| Period |
| Cash Flow | |||||
| Project 1 | Cum. CF | Discounted CF | Cum. CF | ||
| Initial Investment | $ (120,000) | $ (120,000) | $ (120,000) | $ (120,000) | |
| Year | 1 | $ 30,000 | $ (90,000) | $ 27,523 | $ (92,477) |
| Year | 2 | $ 30,000 | $ (60,000) | $ 25,250 | $ (67,227) |
| Year | 3 | $ 30,000 | $ (30,000) | $ 23,166 | $ (44,061) |
| Year | 4 | $ 35,000 | $ 5,000 | $ 24,795 | $ (19,266) |
| Year | 5 | $ 35,000 | $ 40,000 | $ 22,748 | $ 3,481 |
Please find the answer for the Payback Period, Discounted Payback, NPV, IRR for Project One. Explain how to get the answer.
Solutions
jeff jeffy answered 6 months agoRelated Solutions
Project 1 Initial $ 130,000.00 Investment Cost of Capital 7% Target Payback 4 years Period Cash...
Project 1
Initial
$ 130,000.00
Investment
Cost of Capital
7%
Target Payback
4 years
Period
Cash Flow
Project 1
Cum. CF
Discounted CF
Cum. CF
Initial Investment
$ (130,000)
$ (130,000)
$ (130,000)
$ (130,000)
Year
1
$ 33,000
$ (97,000)
$
30841
$ (99,159)
Year
2
$ 33,000
$ (60,000)
$ 28,823
$ (70,335)
Year
3
$ 33,000
$ (31,000)
$ 26,938
$ (43,398)
Year
4
$ 30,000
$
(1,000)
$
22,887
$ (20,511)
Year
5
$ 30,000
$...
Project 1 Initial $ 150,000.00 Investment Cost of Capital 10% Target Payback 4 years Cash Flow...
Project 1
Initial
$ 150,000.00
Investment
Cost of Capital
10%
Target Payback
4 years
Cash Flow
Project 1
Cum. CF
Discounted CF
Cum. CF
Initial Investment
$ (150,000)
$ (150,000)
$ (150,000)
$ (150,000)
Year
1
$ 35,000
$ (115,000)
$
31,818
$ (118,182)
Year
2
$ 35,000
$ (80,000)
$ 28,926
$ (89,256)
Year
3
$ 45,000
$ (35,000)
$
33,809
$ (55,447)
Year
4
$ 45,000
$
10,000
$
30,736
$ (24,711)
Year
5
$ 45,000
$
55,000...
Calculate the Payback Period and Discounted Payback Period for the following project: 1. An initial investment...
Calculate the Payback Period and Discounted Payback
Period for the following project:
1. An initial investment of $20,000 with expected after-tax
operating cash flows of $125,000 per year for each of the
next 3 years. However, in preparation for its
termination at the end of year 3, an additional investment of
$350,000 must be made at the end of Year 2.
Please show all work in excel.
Project 1 Payback period = 2 years 9 months NPV = £2,041
Project 1Payback period = 2 years 9 monthsNPV = £2,041APR = 22.08%Project 2Payback period = 2 years 10 monthsNPV = £3,995APR = 26.19% Based on the above, which project is best to invest in?
Given the following cash flows for a proposed capital investment project, calculate the payback period. Year...
Given the following cash flows for a proposed capital investment
project, calculate the payback period.
Year
Cash Flow
0
-$40,000
1
15,000
2
15,000
3
15,000
4
15,000
5
10,000
6
10,000
Question 4 options:
5.50 years
3.33 years
4.33 years
2.67 years
A capital project has an initial investment of $100,000 and cash flows in years 1-6 of...
A capital project has an initial investment of $100,000 and cash
flows in years 1-6 of $25,000, $15,000, $50,000, $10,000, $10,000,
and $60,000, respectively. Given a 15 percent cost of capital,
(a) compute the net present value.
(b) compute the internal rate of return
(c) should the project be accepted? Why or why not?
Given the following cash flows for a capital project, calculate its payback period and discounted payback...
Given the following cash flows for a capital project, calculate
its payback period and discounted payback period. The required rate
of return is 8 percent. Year 0 1 2 3 4 5 Cash Flows $-37500 $11250
$11250 $15000 $6000 $6000 The discounted payback period is 0.16
year longer than the payback period. 0.80 year longer than the
payback period. 1.27 years longer than the payback period. 1.85
years longer than the payback period.
Given the following cash flows for a capital project, calculate its payback period and discounted payback...
Given the following cash flows for a capital project, calculate
its payback period and discounted payback period. The required rate
of return is 8 percent.
Year
0
1
2
3
4
5
Cash Flows
$-56900
$13650
$18050
$25200
$10000
$5000
The discounted payback period is
A project has an initial cost of $40,000, expected net cash inflows of $9,000 per year for 9 years, and a cost of capital of 11%.
Problem 10-6Discounted PaybackA project has an initial cost of $40,000, expected net cash
inflows of $9,000 per year for 9 years, and a cost of capital of
11%. What is the project's discounted payback period? Round your
answer to two decimal places.years
First five years of a business: Cost of Capital 8.00% Initial Investment $(40,000) Year 1 Cash...
First five years of a business:
Cost of Capital 8.00%
Initial Investment $(40,000)
Year 1 Cash Flows 8,000
Year 2 Cash Flows 9,200
Year 3 Cash Flows 10,000
Year 4 Cash Flows 12,000
Year 5 Cash Flows 14,500
Calculate the net present value (NPV), internal rate of return
(IRR) and payback period.
Assume you can sell the business in year 5 for 10x’s annual cash
flow. Calculate the net present value (NPV) and internal rate of
return (IRR).
Suppose the...
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