Victoria purchase the new tractor

Assignment Help Finance Basics
Reference no: EM132010212

Victoria Moving company is considering whether to purchase a new mini tractor for moving furniture within its warehouse. Victoria calculates that a new mini tractor would cost $3,000. Its current mini tractor generates $3,100 of cash flow per year. The new one will provide cash flow of $4,000 per year for next five years. What is the equivalent annual cash flow for the new mini tractor (round to the nearest dollar), and should Victoria purchase the new tractor? Assume the cost of capital is 10 percent

Reference no: EM132010212

Questions Cloud

How many dollars would revenue increase : A small regional retailer is looking for ways to increase profits. how many dollars would revenue increase?
Years and the account pays annual interest : If you deposit $1000 into an account at the end of each of the next three years and the account pays annual interest rate of 4%
Calculate the future value in four years : Using a financial calculator or spreadsheet, calculate the future value in four years of $15,000 invested today in an account
Describe how sunk costs and opportunity costs : Describe how sunk costs and opportunity costs affect a project's cash flows.
Victoria purchase the new tractor : What is the equivalent annual cash flow for the new mini tractor (round to the nearest dollar), and should Victoria purchase the new tractor?
Which bond has a higher duration : Bond B has a face value of $1,000, a coupon rate of 8%, and a date to maturity of 3 years. Coupons are paid semi-annually.
Set up a private cemetery business : The Yurdone Corporation wants to set up a private cemetery business. According to the CFO, Barry M. Deep, business is "looking up".
Dividend growth and growth in cash flow : Is it reasonable for management to assume that dividend growth and growth in cash flow are essentially identical? Why or Why not?
How big should abebi equal investments be : If the annual interest rate is 8%, how big should Abebi's equal investments be?

Reviews

Write a Review

Finance Basics Questions & Answers

  What is your profit or loss on the contract if the premium

If you buy a put option on a $100,000 Treasury bond futures contract with an exercise price of 95 and the price of the Treasury bond is 120 at expiration, is the contract in the money, out of the money, or at the money? What is your profit or loss on..

  What are foster''s sales net of cash discounts taken

Foster Industries sells on terms of 2/10, net 35. Gross sales last year were $450,000, and accounts receivable averaged $60,000. Half of Foster's customers paid on Day 10 and took discounts.

  What new organizing tactics did harriet blatch

1. What new organizing tactics did Harriet Blatch use in the early twentieth century?

  Comment on the validity or lack thereof of the statement

The value of common stocks cannot be tied to the present value of future dividends because most firms don't pay dividends. Comment on the validity, or lack thereof, of this statement.

  Fixed costs and other financial concepts

Consumers to Live Theaters, can be divided into 2-groups: seniors and everyone else. The inverse demand curves for each of 2-groups are given below.

  What is the firm eva

Its total invested capital is $18,000,000 and its after-tax percentage cost of capital is 7%. What is the firm's EVA?

  Application of capm to stock pricing

Application of CAPM to Stock Pricing:  Explain why stock prices may decrease in response to a higher risk-free rate according to the CAPM.

  Calculate the apv of the project

MVP, Inc., has produced rodeo supplies for over 20 years. The company currently has a debt-equity ratio of 50 percent and is in the 40 percent tax bracket.

  Computation of dividend yield of a company

One year ago, Bob Sakamano invested $10,400 in 200 shares of Vandalay Industries stock and just received a dividend payment (total) of $600. What was Vandalay Industry's dividend yield?

  Finance future value or present value

Calculate the equal annual deposits that you must make for the next 25 years( with the first deposit occurring one year from today) to achieve your desired retirement flow.

  What are the required rates of return on the four stocks

At the times these Betas were developed, resonable estimates for the risk-frfee rate, RF, and required rate of return on the market, R(Rm), were 6.5 percent and 13.5 percent, respectively.

  Assume that a corporation has 100000 of taxable income

assume that a corporation has 100000 of taxable income from operations plus 5000 of interest income and 10000 of

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