Find what is the project''s net present value

Assignment Help Financial Management
Reference no: EM13214971

A project is expected to create operating cash flows of $29,500 a year for three years. The initial cost of the fixed assets is $61,000. These assets will be worthless at the end of the project. An additional $4,500 of net working capital will be required throughout the life of the project. What is the project's net present value if the required rate of return is 12 percent?

Reference no: EM13214971

Questions Cloud

Describe the house-mitchell path-goal theory : Why study situational approaches to leadership? Describe the House-Mitchell Path-Goal Theory and their view of appropriate leadership styles.
What is a reasonable assumptions of mr smiths future lost : Assume Mr. Smith was injured in January 2012 and can no longer work again. How would you calculate his lost earnings Use the spreadsheet attached as a starting point for your analysis. What (if any) accounts should be adjusted
What price will microsoft set for operating systems : Suppose the market for operating systems were perfectly competitive. What price would be charged? How many would be sold? Would the firms in this industry be profitable?
Calculate annual depreciation after the estimate change : Applying the same accounting principles from one reporting period to another enhances the comparability of accounting information across accounting periods. The FASB's conceptual framework describes consistency as one of the important qualitative ..
Find what is the project''s net present value : The initial cost of the fixed assets is $61,000. These assets will be worthless at the end of the project. An additional $4,500 of net working capital will be required throughout the life of the project.
Determine which company you should acquire : Variable costs consist of Cost of goods sold, estimated at 25% of sales; advertising, estimated at 10% of sales; other variable costs, estimated at 5% of sales.
At what level of output would the firm produce : Use the information in the table to calculate total revenue, marginal revenue, and marginal cost. Indicate the profit-maximizing level of output. If the price was $3 and fixed costs were $5, what would variable costs be? At what level of output wo..
Evaluate the overall explanatory power of the regression : Evaluate the overall explanatory power of the regression model. Use a 0.05 level of significance. State all your hypotheses and explain your results. Do not use rules of thumb. Note: You will need to calculate the F statistic to answer this questi..
The make a way foundation has run in the financial crisis : The Make a Way Foundation has run into a financial crisis. Halfway into their fiscal year, the financier has realized that the company has not put enough money aside to cover all of their costs for the children's summer expense project.

Reviews

Write a Review

Financial Management Questions & Answers

  What is the bond''s nominal yield to call

Calculate the YTM and YTC under those conditions, what is your stock's intrinsic value and what is the WACC - What is the bond's nominal yield to call?

  Evaluating value of long-term elements of capital structure

Determine the value of the long-term elements of the capital structure, and find out the target percentages for the optimal capital structure. Carry weights to 4 decimal places.  Evaluate the retained earnings break point.

  Calculate the internal rate of return

Calculate the Internal Rate of return for both projects and again recommend which of the two projects, if any, should be selected based on this information.

  Evaluation of profitability of proposed project

Identifying the errors made by Linton in their project appraisal and calculating the weighted average cost of capital for Everest.

  Explain what is the net income of the firm for the year

cost of goods sold, $450,000 in operating expenses (including a depreciation expense of $150,000), with a tax liability equal to 35% of the firm's taxable income. What is the net income of the firm for the year?

  Graph the bond yield to maturity

Identify two possibly mispriced bond issues, one overpriced and one underpriced. and graph the bond yield to maturity (YTM) on the y-axis of an XY-scatter plot, with the bond to maturity in years on the x-axis.

  What is their yield to maturity

Interest is paid annually, the bonds have a $1,000 par value, and the coupon interest rate is 10%. The bonds sell at a price of $850. What is their yield to maturity?

  Develop monthly cash flow diagrams

Develop MONTHLY cash flow diagrams and analyze the OWN vs. LEASE options to determine which is the better situation.

  Should fuelsource recognize a provision

Should FuelSource recognize a provision as of December 31, 20X1, (1) in reporting to itsU.K. parent under IFRSs and (2) in reporting to its U.S.-based lender in accordance withU.S. GAAP?

  Define investment bankers expect to exercise the option

The investment bankers expect to exercise the option and purchase the 300,000 shares in exactly one year, when the stock price is fore-casted to be $4.50 per share. However, there is a chance that the stock price will actually be $10.00 per share ..

  Evaluation of the models and concepts

Prepare a report on evaluation of the models and concepts proposed outlining their limitations and merits.

  Describe the importance of predicting the long-term value

Explain the importance of predicting the long-term value and price of currency in your chosen country. Determine the relevant factors and indicators for currency forecasting in your selected country.

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