Calculate the npv of eggz inc

Assignment Help Finance Basics
Reference no: EM132465665

Eggz, Inc., is considering the purchase of new equipment that will allow the company to collect loose hen feathers for sale. The equipment will cost $455,000 and will be eligible for 100 percent bonus depreciation. The equipment can be sold for $63,000 at the end of the project in 5 years. Sales would be $347,000 per year, with annual fixed costs of $53,000 and variable costs equal to 40 percent of sales. The project would require an investment of $37,000 in NWC that would be returned at the end of the project. The tax rate is 21 percent and the required return is 13 percent.

Calculate the NPV of this project.

Reference no: EM132465665

Questions Cloud

Who were the given patriots : During the mid 18th Century, English colonists appealed to the metropole for redress of various grievances. In this essay, I want you to consider the ethics.
Development of business and leadership skills : Produce a portfolio that provides evidence of your development of business and leadership skills; this portfolio will include your reflections on development
What is double entry accounting : What is double entry accounting for Owner paid $5,000 for land, Owner collected $8,000 cash for future services ,Owner paid $8,000 cash on account the problems?
Describe your overall reaction after viewing pieces : Visit a museum or art gallery before the end of Week 9. If you are unable to get to a museum or gallery within your area, then a "create your own museum".
Calculate the npv of eggz inc : Eggz, Inc., is considering the purchase of new equipment that will allow the company to collect loose hen feathers for sale
Decide between two different conveyor belt systems : Hagar Industrial Systems Company (HISC) is trying to decide between two different conveyor belt systems. System A costs $360,000, has a 4-year life
What amount should gain from the sale of building be report : At what amount should the gain from the sale of the building be reported? (Round factor values to 5 decimal places, e.g. 1.25124 and final answer to 0 decimal)
Who is more likely to go to the game : If both you and Ted are rational, is one of you more likely to attend the game than the other?
What might influence your decisions about taste and fashion : Imagine you are one of Thomas Chippendale's customers in the eighteenth century. Who or what might influence your decisions about taste and fashion?

Reviews

Write a Review

Finance Basics Questions & Answers

  Compare low debt ratio to high debt ratio

Compare low debt ratio to high debt ratio, and discuss which is more beneficial to a business. The response must be typed, single spaced.

  Evaluating a company ability to make payments

How has the current interest rate environment in the United States impacted the prices of bonds in the bond market?

  Action worth for investor

An action of a corporation pays dividends for $ 2.50, $ 3.00 and $ 2.00 in the first three years. If the investor's discount rate is 8.8%.

  Define the decision to go out of business

Under what circumstances will a firm have to decide whether to operate or to shut down?

  What effect did the expansion have on sales

What effect did the expansion have on sales, after-tax operating income, net working capital (NWC), and net income?

  What is the market user cost of owner-occupied housing

You are looking at a new home in suburban New Jersey which is selling for $250,000. The rent on similar homes in the same development is $1,500 per month. Based on this information, what is the market user cost of owner-occupied housing?

  What is the projects net present value

Using decision-tree analysis, does it make sense to wait 2 years before deciding whether to drill?

  How much is the target cost per unit

A new product is being designed by an engineering team at Golem Security. Several managers and employees from the cost accounting department and the marketing.

  Evaluation of profit of college

Computation of profit of college at given number of student's strength - If the college can enroll 110 students the first year, how much profit will it make?

  Plush pilots inc has balance sheet equity of 60 million at

plush pilots inc. has balance sheet equity of 6.0 million. at the same time the income statement shows net income of

  What share price would you expect after the? announcement

What share price would you expect after the? announcement? (Assume that the new expansion does not change? Cooperton's risk.) Is the expansion a good?investment

  What is the yield to maturity of a semi-annual bond

What is the yield to maturity of a semi-annual bond with 15 years left until it matures, 11% coupon, par value of $1000 and currently selling for $1350. I don't know what formula to use.

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