1. Use Microsoft Excel to solve the question .
The initial cost of an asset is BD100000. It has useful life of 9 years. The estimated salvage value of the asset at the end of useful life is zero. Calculate the annual depreciation and book value using double-declining balance method and find out the year in which the switching is done from double-declining balance method to straight-line method.
Theory related to switching : Switching between different depreciation methods:- Switching from one depreciation method to another is done to accelerate the depreciation of book value of the asset and thus to have tax benefits. Switching is generally done when depreciation amount for a given year by the currently used method is less than that by the new method. The most commonly used switch is from double-declining balance (DDB) method to straight-line (SL) method. In double-declining balance method, the book value never reaches zero. In addition the calculated book value at the end of useful life does not match with the salvage value. Switching from double-declining balance method to straight-line method ensures that the book value does not fall below the estimated salvage value of the asset.
Some seed cleaning equipment was purchased in 2009 for BD 8,500 for an expected life of 12 years. What is the book value of the equipment at the end of 2021? Original salvage value was estimated to be BD 2,500 at the end of 12 years.
Compute using
In: Accounting
What is the weighted-average cost of capital for a firm with the following sources of funds and corresponding required rates of return: $15 million common stock at 15%, $5 million preferred stock at 9%, and $10 million debt at 6%. All amounts are listed at market values and the firm's tax rate is 35%.
A. 9.0%
B. 10.3%
C. 12.1%
D. 13.5%
E. 14.4%
*show work please
In: Finance
The concept of delegation is not new. In today's health-care environment and the need for cost containment, using full RN staffing is unrealistic. Knowing the principles of delegation remains an essential skill for registered nurses.
1. What are the responsibilities of the professional nurse when
delegating tasks to LPN/LVN or NAP?
2. What factors need to be considered when delegating tasks?
3. What is the difference between delegation and assignment?
What type of nursing delivery model is implemented on your assigned
clinical unit?
In: Biology
Kerfuffle Corporation is considering the purchase of a new computer system. The cost for the new system, net of set-up and delivery costs, will be $1.6 million. The new system will provide annual before-tax cost savings of $500,000 for the next five years. The increased efficiency of the new system will lower net working capital by $200,000 today. The CCA rate on the new system will be 30%. At the end of five years, the system can be salvaged for $100,000. The firm’s required rate of return is 15%, and its marginal tax rate is 35%. What is the NPV of this cost-cutting project?
In: Finance
A cost is a resource sacrificed or forgone to achieve a specific objective. TRUE OR FALSE
Managers use assigned cost information to make decisions and implement them.TRUE OR FALSE
The primary user of management accounting information is a(n) ____
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Which of the following is true of financial accounting information?
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In: Accounting
OpenSeas, Inc. is evaluating the purchase of a new cruise ship. The ship will cost $ 495 million and will operate for 20 years. OpenSeas expects annual cash flows from operating the ship to be $ 69.8 million and its cost of capital is 12.1 %. a. Prepare an NPV profile of the purchase. b. Identify the IRR on the graph. c. Should OpenSeas go ahead with the purchase? d. How far off could OpenSeas's cost of capital estimate be before your purchase decision would change? a. Prepare an NPV profile of the purchase. To plot the NPV profile, we compute the NPV of the project for various discount rates and plot the curve. The NPV for a discount rate of 2.0 % is $ nothing million.
In: Finance
A company ,purchases a new machine with an initial cost of $15,000 and a salvage value of $1,800. Net revenues in year 1 are $ 8,000,$8,150 in year 2, and increase by $150 each year the following eight years. Use a MARR of 12% .
a. What is the annual worth ?
b. Determine the IRR of this machine
please show detailed and clear solution with or without using EXCEL. thank you
In: Economics
Cohesive energy of a crystal is the energetic cost that holds all atoms together in a crystal. It can be determined both experimentally and theoretically. Explain, based on your knowledge on the quantum mechanical nature of non–covalent interactions, why the following statement is incorrect:
Because silicon crystal are bonded together by strong covalent bonds between silicon atoms, non– covalent interactions, in particular, dispersion interactions, play NO role in determining the cohesive energy in silicon crystals.
In: Physics
Concept of cost of capital and WACC Mace Manufacturing is in the process of analyzing its investment decision-making procedures. Two projects evaluated by the firm recently involved building new facilities in different regions, North and South. The basic variables surrounding each project analysis and the resulting decision actions are summarized in the following table.
| Basic variables | North | South |
|---|---|---|
| Initial cost | −$6 million | −$5 million |
| Life | 15 years | 15 years |
| Expected return | 8% | 15% |
| Least-cost financing | ||
| Source | Debt | Equity |
| Cost (after-tax) | 7% | 16% |
| Decision | ||
| Action | Invest | Don’t invest |
| Reason | 8% > 7% cost | 15% < 16% cost |
An analyst evaluating the North facility expects that the project will be financed by debt that costs the firm 7%. What recommendation do you think this analyst will make regarding the investment opportunity?
Another analyst assigned to study the South facility believes that funding for that project will come from the firm’s retained earnings at a cost of 16%. What recommendation do you expect this analyst to make regarding the investment?
Explain why the decisions in parts a and b may not be in the best interests of the firm’s investors.
If the firm maintains a capital structure containing 40% debt and 60% equity, find its weighted average cost of capital (WACC) using the data in the table.
If both analysts had used the WACC calculated in part d, what recommendations would they have made regarding the North and South facilities?
Compare and contrast the analyst’s initial recommendations with your findings in part e. Which decision method seems more appropriate? Explain why.
In: Accounting
A company has an EBIT of $4,635 in perpetuity. The unlevered cost of capital is 16.22%, and there are 26,490 common shares outstanding. The company is considering issuing $10,160 in new bonds at par to add financial leverage. The proceeds of the debt issue will be used to repurchase equity. The YTM of the new debt is 11.29% and the tax rate is 34%. What is the cost of the levered equity after the restructuring?
In: Accounting