Duluth Ranch, Inc. purchased a machine on January 1, 2018. The cost of the machine was $38,000. Its estimated residual value was $12,000 at the end of an estimated 5-year life. The company expects to produce a total of 20,000 units. The company produced 1,400 units in 2018 and 1,850 units in 2019.


Required:

Calculate depreciation expense for 2018 and 2019 using the straight-line method.

Calculate the depreciation expense for 2018 and 2019 using the units-of-production method.

Calculate depreciation expense for 2018 through 2022 using the double-declining balance method.

A firm is considering investing in a new project. According to its cost of capital while using debt, preferred stock and new common stock, the project is expected to have an initial after tax cost of $5,000,000. Furthermore, the project is expected to provide after-tax operating cash flows of $1,800,000 in year 1, $2,900,000 in year 2, $2,700,000 in year 3 and $2,300,000 in year 4.

A firm has determined its optimal capital structure, which is composed of the following sources and target market value proportions.

Debt: The firm can raise debt by selling 15-year, $1,000 par value, 9% coupon interest rate bonds that pay annual interest. A flotation cost of 4 percent of the face value would be required in addition to the premium of $10.

Preferred Stock: Preferred stock, regardless of the amount sold, can be issued with an $80 par value and a 12% annual dividend rate. The cost of issuing and selling the stock is $3 per share.

Common Stock: The firm’s common stock is currently selling for $10 per share. The dividend that was paid last year was $0.87. Its dividend payments have been growing at a constant rate of 5% per year. It is expected that to attract buyers, a new common stock issue must be underpriced $2 per share, and the firm must also pay $1 per share in flotation costs.

Retained Earnings: A corporation expects to have earnings available to common shareholders (net income) of $1,000,000 in the coming year. The firm plans to pay 40 percent of earnings available in cash dividends. The retained earnings have been already exhausted. Therefore, the firm will use new common stock as the form of common equity financing. Additionally, the firm’s marginal tax rate is 40 percent.

1. Maximum acceptable payback period of this project is 3 years. Calculate the payback period for this project.
2. Calculate the project’s NPV.
3. Calculate the project’s IRR.
4. Should the firm make the investment? Why?

Nuclear Fuel Cycle:

Assuming that the price per SWU is $80 and the cost of conversion is $4/kgU, what is the
price of the U3O8 ($/lb U3O8) beyond which it will cost less to enrich the already mined, purified, and
converted (to UF6) tails that contain 0.2% U-235 rather than mine new uranium? Assume the product
will be 3% enriched in U-235 in either case and the new tails will be 0.1% (when the old tails are
enriched). Tails stored as UF6 cost nothing.

some key findings about the Economic and cost issue of the opioid crises in the US.

Explain why the marginal cost of production must increased if the marginal product of the marginal resource is decreasing.

1. The Owner’s ability to influence design and cost is highest at the construction phase.

1. True
2. False

2. The conceptual estimate is useful in the schematic design phase when design details are not available.

1. True
2. False

3. A Cost-Plus contract is considered a reimbursable type of contract.

3. True
4. False

4. An advantage of a Lump Sum Contract is that the owner assumes the risk of construction cost.

5. True
6. False

to critically analyze some of the problems associated with basing depreciation expenses on cost model and detrimental impact of fair value based revaluation model.

Suppose a government department would like to investigate the relationship between the cost of heating a home during the month of February in the Northeast and the home's square footage. The accompanying data set shows a random sample of 10 homes. Construct a 90% confidence interval to estimate the average cost in February to heat a Northeast home that is 2,200 square feet.

Determine the upper and lower limits of the confidence interval.

UCL=

LCL=

What is the ratio of cost of a “typical” CT scan vs. a few standard radiographs for the same region (head, chest, etc.)?

Briefly, what is a CT scan—what kind of image does it create and how?

Who invented the CT scan and when?

Two reasons to use a CT scan instead of an X ray (radiograph)?

If you get more information from CT scans, why are simple radiographs still used?

What are Hounsfield units? How is windowing used?

What sort of radiation is involved? Are CT scans “perfectly safe”? If not, what are the dangers?

Suppose a government department would like to investigate the relationship between the cost of heating a home during the month of February in the Northeast and the​ home's square footage. The accompanying data set shows a random sample of 10 homes. Construct a​ 90% prediction interval to estimate the cost in February to heat a Northeast home that is 3,100 square feet.

Heating Cost($)   Square_Footage
340 2430
300 2430
300 2020
260 2220
310 2310
460 2630
330 2210
400 3140
330 2530
380 2910

Determine the upper and lower limits of the prediction interval

UPL=____

LPL=____