Calculate the net present value of the project

Assignment Help Financial Accounting
Reference no: EM132904080

Problem 1: A firm is evaluating an investment with the given the following cash flows in the table below. Suppose the firm's cost of capital is 6%, calculate the net present value of the project with an initial investment of $200,000. Should the firm accept/reject the investment?

Year (t)      Cash Inflows (CFt)
1              $30,000
2.              $30,000
3.              $30,000
4              $30,000
5             $30,000
6                  $30,000

1) -$73,640, accept

2) -$52,490, reject

3) $147,510, accept

4) None of the above options.

Reference no: EM132904080

Questions Cloud

What are the application areas of market research : What are the application areas of market research in the present scenario and explain about any three of them with examples?
What are the application areas of market research : What are the application areas of market research in the present scenario and explain about any three of them with examples?
Demonstrate root causes of incidents : A safety incident has been reported recently. An employee broke his arm during conducting geometry survey.
Different methods of destroying data : Research and explain the different methods of destroying data; provide examples of where they would be employed.
Calculate the net present value of the project : Suppose the firm's cost of capital is 6%, calculate the net present value of the project with an initial investment of $200,000. Should the firm accept/reject
Impact the forensic investigation : Research the challenges of Blockchain technology and how it would impact the forensic investigation.
Matrix in relation to weighted graph representation : Discuss the advantages and disadvantages of adjacency list and adjacency matrix in relation to a weighted graph representation.
Server virtualization and cloud computing : Describe the organization's environment, and evaluate its preparedness for virtualization.
What mrs jones land tax liability is : What Mrs Jones land tax liability is? Mrs Jones owns a property in metropolitan Melbourne. She owns land valued at $450,000 on which she recently erected.

Reviews

Write a Review

Financial Accounting Questions & Answers

  How describe key steps take to set up a reporting system

How Describe three key steps you would take to set up a reporting system for financial project management to ensure that the Project Manager has timely.

  Discuss at least four ethical implications of those acts

Thomas Gilbert and Susan Bradley formed a professional corporation called “Financial Ser-vices Inc.—A Professional Corporation,” each taking 50 percent of the authorized common stock. Gilbert is a CPA and a member of the AICPA. Identify and discuss a..

  Prepare the journal entries in good form to record payroll

Prepare the journal entries in good form to record the payroll. Vacation Destinations total payroll for the month of January was $350,000.

  Journal entry to record income tax

Garl Inc. provided you with the following information: Year 2013 - Accounting Income $1,500,000. Journal entry to Record Income tax for 2013 and 2014

  Compute avoidable interest for Pronghorn Company

Compute avoidable interest for Pronghorn Company. Use the weighted-average interest rate for interest capitalization purposes

  What is yanni share of the net loss for the first year

What is Yanni's share of the net loss for the first year? Assume that there was a net loss for the first year of operation of $26,000 with net income

  Solve depreciation expense and accumulate depreciation

Calculate depreciation expense, accumulate depreciation and book value by using any two depreciation method. Solve the question by preparing appropriate tables.

  Prepare a skeletal profit and loss statement showing dollars

Prepare a skeletal profit and loss statement showing dollars and percentages for a department showing the following values Purchases

  What is the depreciation expense using the double-declining

What is the depreciation expense for 2021 using the double-declining-balance method? On January 1, 2020, Danvers Company purchased a copy machine.

  Cost concept in valuing the cost of long-term assets

US GAAP follows the Historical Cost Concept in valuing the cost of Long-Term Assets. Explain this principle and how it compares to the standards used in the reporting of Long-Term Assets under International Financial Reporting Standards (IFRS). If th..

  What is the return on equity

Question - If a firm has an after-tax profit margin of 5%, an asset turnover of 2.5 times, and no debt, what is the return on equity

  Should exercise the option at expiration

Should exercise the option at expiration if the price of Keebler stock is $80. Will have a worthless option in August if the stock price is $80 at that time.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd