Reference no: EM132070717
1. To maintain a strong credit rating, Freedom will borrow $1.2 million today to finance the Ingleburn facility’s expansion. The ten-year principal-and-interest loan has annual interest repayments of $147,949 (assuming a 4% p.a. rate). Freedom’s accountant confirms that interest is classified as a business expense and is tax deductible.
2. There is an anticipated expense of $180,000 to install the equipment associated with the Ingleburn expansion, and a $50,000 cost to upgrade the electricity supply required to commence operations. According to the ATO both of these items are classified as a business expense. The manager of the Ingleburn facility would prefer to classify these expenses as assets and therefore depreciate them over the ten-year project life to give the appearance of higher profitability for the 2018 financial year. The manager is budgeting to achieve a net profit for 2018 of $1.22 million and increasing it by $150,000 for 2019.
3. You assume that the Ingleburn building can be sold for $1.9 million in the year 2028, and at any point in time the equipment will have a resale value of $650,000. In ten years’ time Freedom assumes that it will have cash holdings of $12 million. You note the ATO regulation that all non-current assets be depreciated to zero.
a) Identify the cash flows at the start
b) Identify the cash flows over the life
c) Identify the cash flows at the end
What is the maximum price that rational and risk-averse
: What is the maximum price that a rational, risk-averse, investors would be willing to pay for the company’s stock today?
|
Prepare an income statement under periodic inventory system
: ACC101 - Fundamentals of Accounting - Discuss whether an asset needs to be legally owned to be recorded as an asset on the balance sheet
|
Describe what diaspora means
: Do your own research and describe what "diaspora" means. Talk to somebody you know from a different culture and ask various questions to learn and understand.
|
How would you critique or improve the proofs
: Descartes offers two proofs for the existence of god, the objective reality proof and the ontological proof. Explain both proofs in detail in your own words.
|
To maintain strong credit rating
: To maintain a strong credit rating, Freedom will borrow $1.2 million today to finance the Ingleburn facility’s expansion.
|
Determine two possible corporate governance challenges
: Determine two possible corporate governance challenges that might be faced by Best Buy as a result of its rapid growth
|
What was the final price of the living room set
: What was the final price (include cost of freight) of the living room set?
|
Write about the students thoughts and experiences
: Students are required to keep a journal to free write about their thoughts, experiences, and observations, as prompts for discussion and writing assignments.
|
Rewrite the given problem related to dba
: SYSDBA is a system privilege that allows and grant the user to shutdown, startup, create, drop and backup database.
|