Take the firm to recover its initial investment in project

Assignment Help Financial Management

Reference no: EM131063447

EKG, Inc. is considering a new project that will require an initial cash investment of $398,000. The project will produce no cash flows for the first two years. The projected cash flows for years 3 through 7 are $79,000, $88,000, $102,000, $140,000, and $160,000, respectively. How long will it take the firm to recover its initial investment in this project? a.) 3.81 years b.) 3.98 years c.) 5.57 years d.) 5.92 years e.) The project never pays back.

Reference no: EM131063447

Questions Cloud

Write a report to the chief finance officer : You are a manager at an audit company. You are currently auditing XYZ Ltd. XYZ Ltd currently has a number of material operating leases reported in the 2015 financial statements.

Trying to determine its cost of debt : Advance, Inc., is trying to determine its cost of debt. The firm has a debt issue outstanding with 16 years to maturity that is quoted at 106 percent of face value. The issue makes semiannual payments and has a coupon rate of 6 percent annually. What..

Prepare a tabular analysis of the transactions : Prepare a tabular analysis of the transactions using the following column headings: Cash, Account receivable, Office Supplies, Land, Account payable, Linda capital and Retained earnings.

Project management-the managerial process : In the written lecture, it is stated, "To grow within the organization, one should be open to working on projects." Why do you believe this is vital, and consider what it might mean in your current work environment?

Take the firm to recover its initial investment in project : EKG, Inc. is considering a new project that will require an initial cash investment of $398,000. The project will produce no cash flows for the first two years. The projected cash flows for years 3 through 7 are $79,000, $88,000, $102,000, $140,000, ..

Discussion about the concept of sampling distribution : Expand upon and paraphrase the following, definitely describe each of the variables - For each variable answer the question is it categorical or numerical?

Is antitrust law in the us working today : Is antitrust law in the US working today? Is a dominating company like Microsoft a positive or negative force? How can every gasoline station in your city adjust its price to the same level within an hour, and it not be collusion? Provide your ass..

Compute a schedule of cost of goods manufactured : Prepare a schedule of cost of goods manufactured. Prepare a schedule of cost of goods sold. Prepare an income statement.

What is the ratio of debt to total long-term capital : A firm has a long-term debt–equity ratio of 0.55. Shareholders’ equity is $1.4 million. Current assets are $425,000, and total assets are $2.420 million. If the current ratio is 1.7, what is the ratio of debt to total long-term capital?

User Account

All Pages