Considering new three-year expansion project

Assignment Help Financial Management
Reference no: EM132002982

Quad Enterprises is considering a new three-year expansion project that requires an initial fixed asset investment of $2.73 million. The fixed asset will be depreciated straight-line to zero over its three-year tax life, after which time it will be worthless. The project is estimated to generate $2,090,000 in annual sales, with costs of $785,000. If the tax rate is 30 percent, what is the OCF for this project? (Do not round intermediate calculations. Enter your answer in dollars, not millions of dollars, e.g. 1,234,567.)

Reference no: EM132002982

Questions Cloud

How can codes of practice be linked to demonstrating : 2) What are the important elements of a supervisory relationship?What particular skills are needed by an effective supervisor?
What are the expected outcomes when using each kind : What are the expected outcomes when using each kind? For example, does using available data enable one to determine cause and effect?
Assignment on simple contact manager : Create a program that simulates a simple contact manager application given the following requirements:
Calculate the price of five-year bond : Calculate the price of a five-year bond that has a coupon of 6.5% paid annually. The current market rate is 5.75%.
Considering new three-year expansion project : Quad Enterprises is considering a new three-year expansion project that requires an initial fixed asset investment of $2.73 million.
What the net inflow or outflow is as measured : What the net inflow or outflow is as measured in U.S. dollars this year? The exchange rate for the euro is $1.29.
The difference between racial stigma and racial stereotyping : Describe the difference between racial stigma and racial stereotyping. Provide an example of each.
What is the aftertax cash flow from the sale of asset : If the relevant tax rate is 34 percent, what is the aftertax cash flow from the sale of this asset?
What kinds or types of variables are there : What is a Variable? What kinds or types of Variables are there?

Reviews

Write a Review

Financial Management Questions & Answers

  Cash collections budget for the nature tour operations

Prepare a cash collections budget for the Nature Tour Operations for the month of June.

  Calculate the projected interest payments and tax shields

calculate the projected interest payments and the amount of the projected interest tax shields through 2010.

  Calculate the price of put option with a strike price equal

Consider a stock that is priced at $20 per share. Calculate the price of a put option with a strike price equal to $15 per share.

  What is the bonds price

ABC Company's bonds mature in 8 years, have a par value of $1,000, and make an annual coupon interest payment of $65. The market requires an interest rate of 7.5% on these bonds. What is the bond's price?

  What is the default risk premium on corporate bonds

There are questions on Financial Management and Markets. Like What is the default risk premium on corporate bonds?

  What is the arithmetic return for the stock

hat is the arithmetic return for the stock? What is the geometric return for the stock?

  Using the relevant net cash flows and cost of capital

Using the relevant net cash flows and cost of capital from A above, calculate the NPV for the project.

  Discuss the stock price performance of the holding company

Discuss the stock price performance of the holding company of the bank during the past three years. Remember the holding company may have other assets than the bank. But for almost all BHCs the bank is the largest asset.

  At the break-even volume-how many units of a will be sold

A company produces two products, A and B. A sells for $16 and has variable costs of $10. B sells for $12 and has variable costs of $8. Fixed Costs for the period are $35,000. An equal number of A and B units are sold. At the break-even volume, how ma..

  Explain the funds allocation among different assets

Explain the funds allocation among different assets that you actually choose in your Stock-Trak portfolio.

  Concept of reversion-property value

The concept of reversion and remainder is not there in most countries. By having such a system, the property value goes up. Why does the value goes up?

  Draw payoff diagram for the portfolios

Draw a payoff diagram for the following portfolios.

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