A flood control project has a construction cost of $10 million in year 1; $6 million in year 2; and $2 million in year 3, when it is completed. Beginning in year 4, annual O&M costs are $200,000/year. The interest rate is 6%. Benefits also begin accruing in year 4, valued at $1.5 million that year. Thereafter, the benefits grow at a uniform rate of $30,000/year until the end of the project life of 50 years.

1. Make a cash flow table of costs and benefits over the 50-year project life using excel.
2. What are the present worth values of the costs and the benefits?
3. What is the net present value of the project?
4. The project is feasible if the ratio of benefits to costs, (B/C) > 1. Is the flood control project feasible?

Dividends Per Share

Imaging Inc., a developer of radiology equipment, has stock outstanding as follows: 20,000 shares of cumulative preferred 4% stock, $130 par, and 67,000 shares of $25 par common. During its first four years of operations, the following amounts were distributed as dividends: first year, $69,600; second year, $148,400; third year, $174,410; fourth year, $184,400.

Compute the dividends per share on each class of stock for each of the four years. Round all answers to two decimal places. If no dividends are paid in a given year, enter "0".

Dividends Per Share Imaging Inc., a developer of radiology equipment, has stock outstanding as follows: 23,000 shares of cumulative preferred 4% stock, $140 par, and 77,000 shares of $20 par common. During its first four years of operations, the following amounts were distributed as dividends: first year, $86,250; second year, $181,350; third year, $218,050; fourth year, $233,520. Compute the dividends per share on each class of stock for each of the four years. Round all answers to two decimal places. If no dividends are paid in a given year, enter "0". 1st Year 2nd Year 3rd Year 4th Year Preferred stock (dividend per share) $ $ $ $ Common stock (dividend per share) $ $ $ $

1) You are considering an investment that will pay you $12,000 the first year, $13,000 the second year, $17,000 the third year, $19,000 the fourth year, $23,000 the fifth year, and $28,000 the sixth year (all payments are at the end of each year). What is the maximum you would be willing to pay for this investment if your opportunity cost is 11%?

3)How much would you be willing to pay for an investment that will pay you and your heirs $16,000 each year in perpetuity if your opportunity cost is 6%?

ONLY ANSWER THIS TWO QUESTIONS! MUST DO ON EXCEL AND SHOW WORK:

Rework Question 1 assuming an opportunity cost of 11% with daily compounding.

Rework question 3) if you want the payments to grow by 2% indefinitely. ( first payment in 16000 in year 1)

Depreciation by Three Methods; Partial Years Perdue Company purchased equipment on April 1 for $80,190. The equipment was expected to have a useful life of three years, or 6,480 operating hours, and a residual value of $2,430. The equipment was used for 1,200 hours during Year 1, 2,300 hours in Year 2, 1,900 hours in Year 3, and 1,080 hours in Year 4. Required: Determine the amount of depreciation expense for the years ended December 31, Year 1, Year 2, Year 3, and Year 4, by (a) the straight-line method, (b) units-of-output method, and (c) the double-declining-balance method. Note: FOR DECLINING BALANCE ONLY, round the multiplier to four decimal places. Then round the answer for each year to the nearest whole dollar. a. Straight-line method

You need a particular piece of equipment for your production process. An​ equipment-leasing company has offered to lease the equipment to you for $ 10,100 per year if you sign a guaranteed 5​-year lease​ (the lease is paid at the end of each​year). The company would also maintain the equipment for you as part of the lease.​ Alternatively, you could buy and maintain the equipment yourself. The cash flows from doing so are listed below​(the equipment has an economic life of 5 ​years). If your discount rate is 6.6%​, what should you​ do?

Year 0 = -$40,700

Year 1: -$2000

Year 2: -$2000

Year 3: -$2000

Year 4: -$2000

Year 5: -$2000

a.) The net present value of the leasing alternative is:

b.) The net present value of the buying alternative is:

The following information pertains to the B, Inc. entity for (fiscal) year ended December 31, 2015. Based upon the information provided, please present the Statement of Net Cash Flow for B, Inc. for the year ended December 31, 2015.

• Net Income for the year was $26,000
• Depreciation Expense for the year was $ 21,000
• A/R increased by $ 5,000 during the year
• Merchandise Inventory decreased by $ 29,000 during the year
• ShortTerm Notes Payable showed a net decrease of $ 11,000 for the year
• A/P showed a net decrease of $ 4,000 for the year
• Other ShortTerm Debt showed a net increase of $ 7,000 for the year
• A cash sale of land was made for $ 52,000
• A cash purchase of a building totaled $ 65,000
• The firm paid off a $ 5,000 loan from lenders
• The firm repurchased Common Stock for $ 7,000

Down Under Boomerang, Inc., is considering a new 7-year project that requires an initial investment in a fixed asset of $2.376 million. The fixed asset will be depreciated straight-line to zero over its 7-year life. After Year 0, the project is expected to generate $2,112,000 in annual sales per year, with operating costs of $844,800 per year. The tax rate is 34 percent and the appropriate discount rate is 9 percent. The project requires an increase in net working capital of $264,000 in Year 0. Net working capital will not change after Year 0 until the last year of the project, at which time net working capital will be completely recovered. The fixed asset will have a salvage value (before-tax) of $184,800 in the last year of the project.

What is the NPV of the project?

Dividends Per Share

Imaging Inc., a developer of radiology equipment, has stock outstanding as follows: 10,000 shares of cumulative preferred 3% stock, $120 par, and 33,000 shares of $5 par common. During its first four years of operations, the following amounts were distributed as dividends: first year, $24,100; second year, $57,900; third year, $69,540; fourth year, $89,130.

Compute the dividends per share on each class of stock for each of the four years. Round all answers to two decimal places. If no dividends are paid in a given year, enter "0".

When Crossett Corporation was organized in January Year 1, it immediately issued 5,700 shares of $54 par, 5 percent, cumulative preferred stock and 11,500 shares of $6 par common stock. Its earnings history is as follows: Year 1, net loss of $12,600; Year 2, net income of $61,900; Year 3, net income of $116,400. The corporation did not pay a dividend in Year 1.

Required
a. How much is the dividend arrearage as of January 1, Year 2?
  

b. Assume that the board of directors declares a $47,780 cash dividend at the end of Year 2 (remember that the Year 1 and Year 2 preferred dividends are due). How will the dividend be divided between the preferred and common stockholders? (Amounts to be deducted should be indicated with minus sign.)