Solution-Compute the pbp and arr, Compute the 1) PBP, 2)

Compute the pbp and arr

Assignment Help Accounting Basics

Reference no: EM132716141

Question - Acquiring an equipment at 300,000 means selling stock valued at 200,000 that pays dividends of 24,000 annually, and borrowing the 100,000 remaining at 6% rate. The weighted cost of capital that he will use is 10% [(2/3*.12) + (1/3*.06)]. The new equipment will be used for 20 years and will produce a cash inflow of 50,000.

Compute the 1) PBP, 2) ARR, with annual depreciation of 14,000, 3) NPV, and 4) IRR. 5) Should the equipment be bought? Explain.

Reference no: EM132716141

Questions Cloud

What is the maximum amount Perfume Division pay : Assume the Bottle Division has no excess capacity and can sell everything produced externally. What is the maximum amount Perfume Division would willing to pay

Scotiabank-kabbage partnership : What are the success factors in the Scotiabank-Kabbage partnership? Under what circumstances should Scotiabank seek fintech partnerships?

Determine the days sales in receivables : Determine the days' sales in receivables for 20Y9 and 20Y8. Use 365 days and round all calculations to one decimal place

Data analyst may not use clusters determined : Explain why a data analyst may not use the clusters determined by the clustering method that gives the "best" solution for the given data set.

Compute the pbp and arr : Compute the 1) PBP, 2) ARR, with annual depreciation of 14,000, 3) NPV, and 4) IRR. 5) Should the equipment be bought? Explain

Character or disposition and emotional : Which one of the following appeals would you focus on in order to convince your CEO that a four-day workweek is beneficial?

When should a firm stop using debt to finance : Question - Using Financial Leverage Effectively. When should a firm stop using debt to finance its operations or asset purchases

Tighter security and ensuring business continuity : Web server auditing can go a long way in enforcing tighter security and ensuring business continuity.

Compute the overall contribution margin ratio : The Cleveland variable expense ratio is 55%. The traceable fixed costs to Greenville are $140,000. Compute the overall contribution margin ratio

User Account

All Pages

Compute the pbp and arr

Reference no: EM132716141

Reference no: EM132716141

Questions Cloud

Reviews

Write a Review

Accounting Basics Questions & Answers

How much control does fed have over this longer real rate

Coures:- fundamental accounting principles

Accounting problems

Theory of interest - term structure of interest rates

Write a report on internal controls

Prepare the bank reconciliation for company

Cost-benefit analysis

Theory of interest

Liquidity and profitability

What is the expected risk premium on the portfolio

Simple interest and compound interest

Capm and venture capital

Assured A++ Grade

Academics

Major Subjects

Majors

Get In Touch

TERMS & POLICIES

HELP & SUPPORT