User Account

All Pages

Question - Evaluating projects with NPV and IRR

Assignment Help Accounting Basics
Reference no: EM132610815

Question - Evaluating projects with NPV & IRR

CBA Sports Inc. is considering testing a $18,000 vending machine at one of its facilities. The manager assigned to study the feasibility of this investment estimates that the operating cash flow will be $3,750 per year. The project is for 6 years and the equipment is expected to have a after-tax salvage value of $2,000 at the end of 6 years when the project is concluded.

1. Create a cash flow table

2. What is the IRR of this project? If the discount rate is 10%, should the company go ahead with the project based on IRR? Why?

3. If the discount rate is 9%, what is the NPV of the project? Should the company go ahead with the project based on NPV? Why?

Reference no: EM132610815

Questions Cloud

Theoretical perspectives and delinquency : There are many perspectives used to explain juvenile delinquency. Do you think juvenile delinquent theories can be applied to all behaviors of juveniles?
Fixed vs. growth mindset collapse : You learned about the importance of adopting a growth mindset vs. a fixed mindset.
What does often-repeated phrase government of laws : What does the often-repeated phrase "a government of laws, not of men" mean, and how does it apply to bureaucratic accountability?
Setting goals and objectives : You will prepare a PowerPoint presentation that establishes the goal and explains the related objectives for the Fiction land Police Department.
Question - Evaluating projects with NPV and IRR : Evaluating projects with NPV & IRR - If the discount rate is 9%, what is the NPV of the project? Should the company go ahead with the project based on NPV? Why
Discuss biological theories of crime : Discuss biological theories of crime and the different aspects of biology that have been explored in relation to crime. Describe crime prevention policies
Examine different periods of policing : Examine different periods of policing and discuss their main strengths and weaknesses. Explain how technology affects policing in today's society,
Compute the dividend payout ratio : On January 1, 2019, Accounting For You Professional Corporation had $ 2,000,000 of common shares. Compute the dividend payout ratio for 2019
Difference in public vs private run correctional institution : What might be the major differences in public vs private run correctional institutions (pro and cons)?

Reviews

Write a Review

Accounting Basics Questions & Answers

  The new manager of the cpu assembly department was asked to

bell computers ltd. located in liverpool england assembles a standardized personal computer from parts it purchases

  Journalize and post the adjusting entires

Kristin Malone opened Kristin's Maids Cleaning Service on July 1, 2017. Journalize and post the adjusting entires

  Keefe inc a calendar year corporation acquires 70 of george

keefe inc. a calendar year corporation acquires 70 of george company on september 1 2009 and an additional 10 on april

  The accounts and their amounts for belgrave co at december

the accounts and their amounts for belgrave co. at december 31 2012 are listed below. 1prepare the income statement

  Prepare a manufacturing overhead budget

Sleds, Inc. manufactures and sells snow- boards. Sleds manufactures a single model, the Pipex. Prepare a manufacturing overhead budget for 2013

  Can you offer any explanation for the dis-alloweance

She paid interest of 5,500 in 2017, 0 in 2018, and 9,000 in 2019. The IRS disallowed the deduction. Can you offer any explanation for the dis-alloweance

  Allocate the impairment loss to the net assets

Allocate the impairment loss to the net assets of the wireless division using the cost recovery model under ASPE

  Prepare a 2011 statement of stockholders equity

The Cleaning Authority provides janitorial services for commercial customers. On December 31, 2010, the credit balance of the Common Stock and Retained Earnings accounts were $12,000 and $5,500, respectively. During 2011, the company issued $4,200..

  How long must the investor hold the bond to overcome

Given the bond's income advantage, how long must the investor hold the bond to overcome the premium over the bond's value as stock

  Straight-line amortization

Interest is paid semiannually on December 1 and June 1 and the bonds mature on December 1, 2014. Menke uses straight-line amortization. Ignoring income taxes, the amount reported in Menke's 2010 income statement from this investment should be?

  Back mountain industries bmi has two divisions east and

back mountain industries bmi has two divisions east and west. bmi has a cost-of-capital of 16.1. selected financial

  What is the opportunity cost to the farmer

A farmer has land that can produce 20 bushels of corn per acre or 10 bushels of wheat per acre. What is the opportunity cost to the farmer

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd