Question
In: Finance
A 7-year project is expected to provide annual sales of $153,000 with costs of $89,000. The...
A 7-year project is expected to provide annual sales of $153,000 with costs of $89,000. The equipment necessary for the project will cost $275,000 and will be depreciated on a straight-line method over the life of the project. You feel that both sales and costs are accurate to +/-10 percent. The tax rate is 40 percent. What is the annual operating cash flow for the worst-case scenario? a)50994 b)39594 c)68634 d)23880 e)31634
Solutions
jeff jeffy answered 1 year agoRelated Solutions
A 7-year project is expected to generate annual sales of 10,400 units at a price of...
A 7-year project is expected to generate annual sales of 10,400
units at a price of $91 per unit and a variable cost of $62 per
unit. The equipment necessary for the project will cost $437,000
and will be depreciated on a straight-line basis over the life of
the project. Fixed costs are $265,000 per year and the tax rate is
35 percent. How sensitive is the operating cash flow to a $1 change
in the per unit sales price?
A 10-year project is expected to generate annual sales of $262100, variable costs of $40543, and...
A 10-year project is expected to generate annual sales of
$262100, variable costs of $40543, and fixed costs of $49005. The
annual depreciation is $23639 and the tax rate is 27 percent. What
is the annual operating cash flow
Enter your answer rounded off to two decimal points. Do not
enter $ or comma in the answer box. For example, if your answer is
$12.345 then enter as 12.35 in the answer box.
A 5-year project is expected to generate annual sales of 9,600 units at a price of $83 per
A 5-year project is expected to generate annual sales of 9,600 units at a price of $83 per unit and a variable cost of $54 per unit. The equipment necessary for the project will cost $373,000 and will be depreciated on a straight-line basis over the life of the project. Fixed costs are $225,000 per year and the tax rate is 22 percent. How sensitive is the operating cash flow to a $1 change in the per unit sales price?
ABC Company is considering a new project. The project is expected to generate annual sales of...
ABC Company is considering a new project. The project is
expected to generate annual sales of $65476, variable costs of
$18689, and fixed costs of $9650. The depreciation expense each
year is $10884 and the tax rate is 25 percent. What is the annual
operating cash flow
ABC Company is considering a new project. The project is expected to generate annual sales of...
ABC Company is considering a new project. The project is
expected to generate annual sales of $65476, variable costs of
$18689, and fixed costs of $9650. The depreciation expense each
year is $10884 and the tax rate is 25 percent. What is the annual
operating cash flow? Enter your answer rounded off to two decimal
points. Do not enter $ or comma in the answer box. For example, if
your answer is $12.345 then enter as 12.35 in the answer...
Project L costs $35,000, its expected cash inflows are $11,000 per year for 7 years, and...
Project L costs $35,000, its expected cash inflows are $11,000
per year for 7 years, and its WACC is 9%. What is the project's
payback? Round your answer to two decimal places.
___years
A new project is expected to generate annual sales of $74 million, annual expenses of $42...
A new project is expected to generate annual sales of $74
million, annual expenses of $42 million, and an annual depreciation
expense of $10 million. The firm's tax rate is 35%. Calculate the
OCF (Operating Cash flow) for the year by using any of the three
methods discussed in the chapter 9
A project that costs $2,800 to install will provide annual cash flows of $630 for the...
A project that costs $2,800 to install will provide annual cash
flows of $630 for the next 6 years. The firm accepts projects with
payback periods of less than 4 years.
a-1.
What is this project's payback period? (Round your
answer to 3 decimal places.)
Payback period
years
a-2.
Will the project be accepted?
No
Yes
b-1.
What is project NPV if the discount rate is 2%? (Do not
round intermediate calculations. Round your answer to 2 decimal
places.)
NPV...
1.Project K costs $50,000, its expected cash inflows are $12,000 per year for 7 years, and...
1.Project K costs $50,000, its expected cash inflows are $12,000
per year for 7 years, and its WACC is 11%. What is the project’s
payback?
Please show the steps. Thank you
1.Project K costs $50,000, its expected cash inflows are $12,000 per year for 7 years, and...
1.Project K costs $50,000, its expected cash inflows are $12,000
per year for 7 years, and its WACC is 11%. What is the project’s
payback?
Please show the steps. Thank you
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