Compute the roi of the radio project alone

Assignment Help Accounting Basics
Reference no: EM131697364

Question: Return on Investment and Investment Decisions Leslie Blandings, division manager of Audiotech Inc., was debating the merits of a new product-a weather radio that would put out a warning if the county in which the listener lived were under a severe thunderstorm or tornado alert. The budgeted income of the division was $725,000 with operating assets of $3,625,000. The proposed investment would add income of $640,000 and would require an additional investment in equipment of $4,000,000. The minimum required return on investment for the company is 12 percent. Round all numbers to two decimal places.

Required: 1. Compute the ROI of the:

a. division if the radio project is not undertaken.

b. radio project alone.

c. division if the radio project is undertaken.

2. Compute the residual income of the:

a. division if the radio project is not undertaken.

b. radio project alone.

c. division if the radio project is undertaken.

3. Conceptual Connection: Do you suppose that Leslie will decide to invest in the new radio? Why or why not?

Reference no: EM131697364

Questions Cloud

How much money does she need to contribute per month : Monica has decided that she wants to build enough retirement wealth that, How much money does she need to contribute per month to reach her goal
Compute the present value of payments : Given a 6 percent interest rate, compute the present value of payments made in years 1, 2, 3, and 4 of $1,400, $1,700, $1,700, and $1,800
Stakeholder management aspects of project : A University is moving to a new HR/Payroll system that is sponsored by a firm call Workday.com. You have been asked to oversee the stakeholder management aspect
Turing machine simulator to program a turing machine : Use the online Turing machine simulator to program a Turing machine - the second for 2 + 3. I should be able to copy each of your lines into
Compute the roi of the radio project alone : Return on Investment and Investment Decisions Leslie Blandings, division manager of Audiotech Inc., was debating the merits of a new product-a weather radio.
Comparative measures of performance by comparing : Carry out an analysis of the business by using comparative measures of performance by comparing your business performance.
Calculate the payback npv and irr for project approval : Nabisco is planning to erect new manufacturing campus in Raleigh, North Carolina. Calculate payback, NPV and IRR and make a recommendation for project approval
What was your understanding of individuals with disabilities : Answer the following questions and include the information on ADA: Before viewing this film, what was your understanding of individuals with disabilities?
Does art imitate life or does life imitate art : Is art driven by the world (society) in which it's created or does it drive the world (society) in which it's created in a specific direction?

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

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