Q) A firm has a WACC of 12.87% and is deciding between two mutually exclusive projects. Project A has an initial investment of $60.18. The additional cash flows for project A are: year 1 = $18.93, year 2 = $36.27, year 3 = $42.07. Project B has an initial investment of $74.47. The cash flows for project B are: year 1 = $51.07, year 2 = $49.52, year 3 = $25.82. Calculate the Following:
a) Payback Period for Project A:
b) Payback Period for Project B:
c) NPV for Project A:
d) NPV for Project B:
In: Finance
The following information relates to ABC Pty Ltd for the years ended 30 June Year 3 and Year 2: Year 3 $ Year 2 $ Total assets Owners’ equity 6,020,000 3,250,000 5,470,000 3,200,000 Annual sales Net profit (after tax) Weighted average number of ordinary shares issued 6,100,000 810,000 10,234,518 3,154,350 475,200 10,046,430 Required: Calculate the net profit margin, asset turnover, earnings per share and debt to total assets ratios for ABC Ltd for the year ended 30 June Year 3
In: Accounting
Q) A firm has a WACC of 10.50% and is deciding between two mutually exclusive projects. Project A has an initial investment of $61.58. The additional cash flows for project A are: year 1 = $19.92, year 2 = $37.52, year 3 = $50.93. Project B has an initial investment of $71.57. The cash flows for project B are: year 1 = $58.06, year 2 = $38.54, year 3 = $38.53. Calculate the Following:
a) Payback Period for Project A:
b) Payback Period for Project B:
c) NPV for Project A:
d) NPV for Project B:
In: Finance
A firm has a WACC of 10.73% and is deciding between two mutually exclusive projects. Project A has an initial investment of $60.37. The additional cash flows for project A are: year 1 = $16.93, year 2 = $36.08, year 3 = $66.38. Project B has an initial investment of $71.10. The cash flows for project B are: year 1 = $58.77, year 2 = $41.33, year 3 = $28.93. Calculate the Following:
a) Payback Period for Project A:
b) Payback Period for Project B:
c) NPV for Project A:
d) NPV for Project B:
In: Finance
SimpsonSimpson Company's inventory records for the most recent year contain the following data:
Quantity Unit Cost
Beginning inventory 2,000 $8.00
Purchases during year 18,000 $10.00
Simpson Company sold a total of 19,800 units during this year.
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1. Using the average- cost method, compute the cost of goods sold and the ending inventory of the year. 2. Using the FIFO method, compute the cost of goods sold and the ending inventory of the year. 3. Using the LIFO method, compute the cost of goods sold and the ending inventory of the year |
In: Accounting
The following is a list of prices for zero-coupon bonds with different maturities but same par value of $1,000: the 1-year zero bond sells at $925.15, the 2-year zero bond sells at $862.57, the 3-year zero bond sells at $788.66, and the 4-year zero bond sells at $711.00. You have purchased a 4-year maturity bond with a 9% coupon rate paid annually. The bond has a par value of $1,000. What would be the price of the bond one year from now if the implied forward rates stay the same?
In: Finance
A firm utilizes a strategy of capital rationing, which is currently $375,000 and is considering the following two projects: Project A has a cost of $335,000 and the following cash flows: year 1 $140,000; year 2 $150,000; and year 3 $100,000. Project B has a cost of $365,000 and the following cash flows: year 1 $220,000; year 2 $110,000; and year 3 $150,000. Using a 6% cost of capital, which decision should the financial manager make?
Select project A.
Select project B.
Do not select either project.
Select both projects.
In: Accounting
Calculate the following information for a $50,000 loan with four (4) annual payments that have a variable interest rate each year.
In year 1, the interest rate is 9.50%.
In year 2, the interest rate is 8.75%.
In year 3, the interest rate is 11.50%.
In year 4, the interest rate is 5.00%
In order for your answers to be marked correct by Canvas, remember to include dollar signs ($), commas for each thousand (000) dollars, and to the nearest whole cent.
| Year | Total Payment | Interest | Principal | Loan Balance |
| 0 | ||||
| 1 | ||||
| 2 | ||||
| 3 | ||||
| 4 | $0 |
In: Finance
Ramirez company installs a computerized manufacturing machine in its factory at the beginning of the year at a cost of $43,500. The machine's useful life is estimated at 10 years, or 385,000 units of product, with a $5,000 salvage value. During its second year, the machine produces 32,500 units of product.
A. Determine the machine's second year depreciation and year end book value under the straight-line method.
B. Determine the machine's second year depreciation using the units-of-production method.
C. Determine the machine's second-year depreciation using the double-declining-balance method.
In: Accounting
Suppose a company has two mutually exclusive projects, both of which are three years in length. Project A has an initial outlay of $6,000 and has expected cash flows of $4,000 in year 1, $5,000 in year 2, and $5,000 in year 3. Project B has an initial outlay of $9,000 and has expected cash flows of $2,000 in year 1, $4,000 in year 2, and $5,000 in year 3. The required rate of return is 10% for projects at this company. What is the net present value for the best project? (Answer to the nearest dollar.)
In: Finance