A 5-year project requires a $300,000 investment in a machine that is expected to worth $50,000 when the project ends. Operating expenses are expected to be $75,000 in the first year and are expected to increase 3% per year over the life of the project. The appropriate discount rate is 8%, the company’s tax rate is 20%, and the CCA rate is 30%. What is the present value of the CCA tax shield? (Do not round intermediate calculations. Round the final answer to 2 decimal places. Omit any commas and the $ sign in your response. For example, an answer of $1,000.50 should be entered as 1000.50.)

PVCCATS=(IdTcd+k) (1+.5k1+k)− (SndTcd+k) (1(1+k)n)PVCCATS=IdTcd+k 1+.5k1+k- SndTcd+k 1(1+k)

(1).  ABC expects sales of $21,830,000 this year. The cost of goods sold is expected to be $12,468,000 while selling, general and admin (SGA) expenses are forecast to be $4,114,000. The firm expects depreciation expenses to be $202,000 and expects to pay an average interest rate of 4% on its $4,415,000 of liabilities. Given its tax rate of 40%, what is the expected net income for ABC this year?(If it is a negative, be sure and enter a negative sign)

(2). This year, ABC expects sales of $137,328,000 and a gross profit margin of 16 percent this year, along with an Inventory Turnover Ratio (COGS / Inventory) of 6.10. What is ABC's projected level of inventory, given these numbers?

(3). This year, ABC had sales of $34,914,000 and an Accounts Receivable Turnover Ratio (Sales / Accounts Receivable) of 8.7. ABC projects that next year, its sales will grow by 10 percent while its Accounts Receivable Turnover Ratio will drop to 8.4. If that happens, what will be the total dollar amount in accounts receivable next year?

(4). In its most recent financial statements, ABC reported 93,000 of net income and 302,000 of retained earnings. The retained earnings at the end of the previous year were 282,000. Based on this information, what is the best estimate of how much in dividends was paid to shareholders during the year?

(5). ABC ended the year with inventory of 812,000. During the year, the firm purchased 5,215,000 of new inventory and the cost of goods sold reported on the income statement was 5,079,000. Assuming that there were no other changes during the year, how much was ABC's inventory at the beginning of the year?

(6). ABC extends credit to its customers on terms of 2/10, net 40. Assuming a customer pays the invoice at the end of the costly trade credit period, what is the annualized cost of trade credit? (Show your answer in decimal form to four places, e.g., 12.34% would be 0.1234)

(7). Fred deposited $3,362 in a savings account that has an Annual Percentage Rate of 8.4 percent interest per year. How much will he have in the account after 6 years? (Show your answer as a positive number)

(8). ABC has a beta of 0.53. The expected return for the S&P 500 stock index is 15 percent and U.S. Treasuries are expected to yield 3.7 percent. Based on the Capital Asset Pricing Model (CAPM), what is ABC's expected rate of return? (show your answer in decimal form to four places)

(9). Mike and Cindy are buying a new car, but they are on a budget. The think that they can afford to pay $285 per month for 3 years, based on an annual interest rate of 7.5 percent. How much can they afford to borrow, given this information? (Show your answer to the nearest dollar)

(10). What is the present value of an ordinary annuity of $666.6 per month for 7 years, evaluated at a nominal annual interest rate of 12.2 percent?

(11). Fred owes $11,000 on his credit card, which carries an annual interest rate of 16.7 percent. If he does not charge anything else and sends the credit card company $521 every month, how many months will it take to pay off the card? (Show your answer to two decimal places, e.g., 12.34)

(12). You are buying a house and have borrowed $180,000 at an annual interest rate of 7.2 percent. The terms of the loan require you to make monthly payments and to completely amortize the loan over thirty years. How much is each monthly payment?

(13). Although Bill has nothing saved for retirement so far, he has determined that he will need to have $774,000 in the account when he retires. He plans to open a retirement account and make monthly contributions from his paycheck. The account that earns 10 percent annual interest (which is compounded monthly). How much will he have to invest each month to be able to reach his goal at the end of 26 years? Show your answer as a positive number to the nearest penny.

(14). Fred is setting up a trust fund for his son. The trust will pay his son $2,000 each year for the next 34 years. If the trust fund earns 7.2 percent interest per year, how much does Fred have to put into the trust fund today in order to fund the series of annual payments? (Show your answer as a positive number).

(15). If you deposit $667 per month into a savings account that pays an annual rate of 9.8 percent, compounded monthly, how much will you have in the account after 24 years?

(16). Ted wants to purchase some outstanding shares of preferred stock that promise an annual payment of $8.82 forever. Assuming Ted requires an investment return of 5.6 percent on similar investments, what is the most he should be willing to pay per share?

Answer the questions that follow this table – TABLE 2

8. What is meant by Capital intensity? Give an example to fully describe

A fund has 100,000 at the start of the year. Six months later, the fund has a value of 75,000 at which time, Stuart adds an additional 75,000 to the fund. At the end of the year, the fund has a value of 200,000. Calculate the exact dollar weighted rate of return.

Afund has 10,000 at the start of the year. Six months later, the fund has a value of 15,000 at which time, Stuart removes 5,000 from the fund. At the end of the year, the fund has a value of 10,000. Calculate the exact dollar weighted rate of return less the time weighted rate of return.

Squaw Valley Recreation is in the process of analyzing a new three year project to grow their business. At the beginning of this project, Squaw Valley will need to spend $2,460,000 to build the required fixed asset. This asset will have a depreciation period of three-years and will use the straight-line method of depreciation and it will be depreciated to zero. The asset will have no salvage value at the end of the project. This new project will have an estimated annual sales amount of $2,950,000. The estimated annual costs for this project are $1,970,000. The appropriate tax rate to use for this analysis is 22 percent. The CFO of Squaw Valley has indicated that the required return for this project is 9 percent. Calculate the NPV for this project.  (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

A homeowner could take out a 15 year mortgage at a 3.5% annual rate on a $250,000 mortgage amount or she could refinance the purchase with a 30 year mortgage at a 4% annual rate. How much total interest over the entire mortgage periods could she save by financing her home with a 15 year mortgage to the nearest dollar? 1.) 130,408 2.) 110,105 3.)107,977 4.) 95,107 5.) 150,250