Expansion project that requires initial fixed asset

Assignment Help Financial Management
Reference no: EM131884014

Summer Tyme, Inc., is considering a new 3-year expansion project that requires an initial fixed asset investment of $4.644 million. The fixed asset will be depreciated straight-line to zero over its 3-year tax life, after which time it will be worthless. The project is estimated to generate $4,128,000 in annual sales, with costs of $1,651,200. If the tax rate is 33%, what is the annual operating cash flow (OCF) for this project?

Reference no: EM131884014

Questions Cloud

Summarizes career planning and professional goals : The Professional Profile section summarizes your career planning and professional goals. You have already compiled the documents for this section in Modules.
Discuss the four spheres of political action in nursing : Discuss the four spheres of political action in nursing. Develop a brief argument sharing how these spheres are interconnected and overlapping.
What was average real risk-free rate over this time period : What was the average real risk-free rate over this time period? What was the average real risk premium?
Why illness and stress amplified the spiritual concern : Why did you discover that illness and stress amplified the spiritual concern and needs of your interviewee? Explain your answer with examples.
Expansion project that requires initial fixed asset : Summer Tyme, Inc., is considering a new 3-year expansion project that requires an initial fixed asset investment of $4.644 million.
Considering new three-year expansion project : Sextet Corporation is considering a new three-year expansion project that requires an initial fixed asset investment of $2.94 million.
How differentiation will help position the organization : Compare and contrast the Five-Step Process with two alternative methods for conducting marketing research. What are the pros and cons of each?
What is the current market value of the firm debt : The yield to maturity is 12%, so the bonds now sell below par. What is the current market value of the firm's debt?
What is the morally right thing to do : A runaway train is speeding down a track. There are five people tied to the track in the train's path. If the train isn't stopped, the five people will for sure

Reviews

Write a Review

Financial Management Questions & Answers

  Ecological desirable insect control mechanisms

ICI plans to breed toads and sell them as ecological desirable insect control mechanisms.

  What was the standard deviation of crash-n-burn returns

You've observed the following returns on Crash-n-Burn Computer's stock over the past five years: 13 percent, -8 percent, 16 percent, 16 percent, and 10 percent. a) What was the arithmetric average return on Crash-n-Burn's stock over the five year per..

  What is the bond nominal yield to maturity

What is the bond's nominal yield to maturity? Would an investor be more likely to earn the YTM or the YTC?

  Compute the irr and mirr for project erie

Based on the cash flows shown in the chart below, compute the IRR and MIRR for Project Erie. Suppose that the appropriate cost of capital is 12 percent. Advise the organization about whether it should accept or reject the project.

  Describe the financial statements and the financial position

Describe financial statements and financial position of health care institutions. Describe overall planning process and the key components of financial plan.

  Take any information from internet and use it

Hey last time you did a good job but i lost 9 marks this time do it perfect so i don't loose points and don't take any information from internet.

  The cheapest source of financing for your startup

For each alternative, what is the amount owed in one month? Which alternative is the cheapest source of financing for your startup?

  Npv calculate the net present value

NPV Calculate the net present value (NPV) for the following 15-year projects.

  Indicate whether they are portfolio-passive or active

For the following activities, indicate whether they are Portfolio, Passive or Active.

  Suppose the shares of ucantpurchase are not traded

Suppose the shares of UCANTPURCHASE are not traded. Using options and lending, you can create a portfolio that would produce the same payoffs of a long position. What would the combination be comprised of to replicate the payoff? PLEASE EXPLAIN IN DE..

  What is the approximate payback period in years

Michigan Mattress Company is considering the purchase of land and the construction of a new plant. The land and building, which be bought immediately (at t = 0), has a cost of $74998. It is estimated that the firm's after-tax yearly cash flow will be..

  Example of nondeposit-type financial institution

A commercial bank is an example of nondeposit-type financial institution.

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