Suppose we are thinking about replacing an old computer with a new one. The old one cost us $1,640,000; the new one will cost, $1,975,000. The new machine will be depreciated straight-line to zero over its five-year life. It will probably be worth about $420,000 after five years. The old computer is being depreciated at a rate of $344,000 per year. It will be completely written off in three years. If we don’t replace it now, we will have to replace it in two years. We can sell it now for $540,000; in two years, it will probably be worth $156,000. The new machine will save us $368,000 per year in operating costs. The tax rate is 24 percent, and the discount rate is 11 percent.

a-1. Calculate the EAC for the the old computer and the new computer. (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)

a-2. What is the NPV of the decision to replace the computer now? (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.)

NPV and IRR   Benson Designs has prepared the following estimates for a​ long-term project it is considering. The initial investment is

23,260

and the project is expected to yield​ after-tax cash inflows of

7000

per year for

5

years. The firm has a cost of capital of

11%.

a.  Determine the net present value​ (NPV) for the project.

b.  Determine the internal rate of return​ (IRR) for the project.

c.  Would you recommend that the firm accept or reject the​ project?

Define learning and classify the different process of behavior
modification.

Consider price quotes and characteristics for two different bonds:

At the same time, you observe the spot rates for the next three years:

Demonstrate whether the price for either of these bonds is consistent with the quoted spot rates. Under these conditions, recommend whether Bond A or Bond B appears to be the better purchase. Do not round intermediate calculations. Round your answers to the nearest cent.

The non-arbitrage price of Bond A: $____

The non-arbitrage price of Bond B: $____

____ appears to be the better purchase.

Create the following classes and show a “Hierarchical” relationship between them:     

     Company, Products and Employee   

• Define at least 2 instance variables of these classes.
• company: company_code, company_name
• Employee: employee_ name, number_of_employees.
• Choose the appropriate members for Products by your own understanding.
• Write default and overloaded constructors for each class
• Include a method in all the classes by the same name that overrides the direct or indirect base classes.

You are considering a project that will require an initial outlay of $54,200. This project has an expected life of 5 years and will generate after-tax flows to the company as a whole of $20,608 at the end of each year over its 5-year life. In addition to the $20, 608 cash flow from operations during the fifth and final year, there will be an additional cash outflow of $23,608 at the end of the fifth and final year associated with the removal of environmental waste, making the cash flow in year 5 equal to $-3,000. Given a required rate of return of 15 %

a. Calculate the IRR.

b. Calculate the net present value (NPV).

c. Calculate the MIRR.

d. Based on the answers above, should the project be accepted? Explain.

Year 0 1 2 3 FTF(Mil) -100 50 100 70 Suppose? Alcatel-Lucent has an equity cost of capital of 10%?, market capitalization of $10.80 ?billion, and an enterprise value of $14.4 billion. Suppose? Alcatel-Lucent's debt cost of capital is 6.1% and its marginal tax rate is 35%.

a. What is? Alcatel-Lucent's WACC?

b. If? Alcatel-Lucent maintains a constant? debt-equity ratio, what is the value of a project with average risk and the expected free cash flows as shown? here,? c. If? Alcatel-Lucent maintains its? debt-equity ratio, what is the debt capacity of the project in part ?(b?)? . What is? Alcatel-Lucent's WACC? ?Alcatel-Lucent's WACC is ______%. ?(Round to two decimal? places.)

b. If? Alcatel-Lucent maintains a constant? debt-equity ratio, what is the value of a project with average risk and the expected free cash flows as shown? here, LOADING... ?? The NPV of the project is ?$________million.???(Round to two decimal? places.)

c. If? Alcatel-Lucent maintains its? debt-equity ratio, what is the debt capacity of the project in part ?(b?)? The debt capacity of the project in part ?(b?) is as? follows:???(Round to two decimal? places.) Year 0 1 2 3 Debt capacity ?$_______million ?$________million ?$_________million ?$_________million

Client X operates in the US currently and is planning to expand operations globally next year. As a result, management is considering preparing financial statements in accordance with IFRS rather than with US GAAP. Client X contacted you for clarification and recommendations regarding the following issues: How the use of the LIFO method to value its inventories will be impacted if a switch to financial statements prepared in compliance with IFRS will be made. Whether interest cost on construction of a new warehouse may be included in the cost of the new warehouse. In what instances should goodwill be adjusted for impairment? Provide a 150- word overview of each issue, followed by solid responses supported by research and proper citing.

Margin of Safety

Yellow Sticker Company’s variable expenses are 40% of sales. The company has monthly fixed expenses of $15,000 and sells each unit for $0.50. The monthly target operating income is $10,500.

What are mutually exclusive projects? What are some of the ways we can evaluate which project is the better investment?

1. What do you think are the current and potential challenges and opportunities in the human resources management area?

2. Describe vividly breakeven analysis and explain what a breakeven point is.

Identify and explain at least 4 non-store retailing businesses. What advantages may non-store retailers have over store retailers?

A company manufacturing toys has a fixed cost of $60,000. Variable cost is 6 per toy.

Selling price is $10 per toy. Company target profit is $100,000.

The company found that its variable cost is going to increase by $1.5 and plans to raise its selling price by $3 and reduced the fixed costs by $20,000.

1. How many more (less) toys must be sold at the new price to reach the target profit of $100,000?

2. What is the markup (profit margin %) on sales price at this new sales volume? What is the markup (profit margin %) on total cost?

The following selected accounts appear in the ledger of Upscale Construction Inc. at the beginning of the current year:

During the year, the corporation completed a number of transactions affecting the stockholders' equity. They are summarized as follows:

1. Issued 80,000 shares of common stock at $23, receiving cash.
2. Issued 20,000 shares of preferred 2% stock at $192.
3. Purchased 48,000 shares of treasury common for $21 per share.
4. Sold 24,000 shares of treasury common for $24 per share.
5. Sold 16,000 shares of treasury common for $19 per share.
6. Declared cash dividends of $3.50 per share on preferred stock and $0.06 per share on common stock.
7. Paid the cash dividends.

Required:

Journalize the entries to record the transactions. If an amount box does not require an entry, leave it blank.

a. Issued 80,000 shares of common stock at $23, receiving cash.

b. Issued 20,000 shares of preferred 2% stock at $192.

c. Purchased 48,000 shares of treasury common for $21 per share.

d. Sold 24,000 shares of treasury common for $24 per share.

e. Sold 16,000 shares of treasury common for $19 per share.

f. Declared cash dividends of $3.50 per share on preferred stock and $0.06 per share on common stock.

g. Paid the cash dividends.