User Account

All Pages

What are the operating cash flows in year

Assignment Help Finance Basics
Reference no: EM133119204

Johnny's Lunches is considering purchasing a new, energy-efficient grill. The grill will cost $46,000 and will be depreciated straight-line over 3 years. It will be sold for scrap metal after 5 years for $11,500. The grill will have no effect on revenues but will save Johnny's $23,000 in energy expenses. The tax rate is 30%.

Required:

a. What are the operating cash flows in each year?

b. What are the total cash flows in each year?

c. Assuming the discount rate is 12%, calculate the net present value (NPV) of the cash flow stream. Should the grill be purchased?

Reference no: EM133119204

Questions Cloud

What is the theta of the option as the expiration time : What is the theta of the option as the expiration time declines from 60 to 50 days? Answer to 2 decimal places.
Why the elevator speech is important : Why the elevator speech is important and how it will help you prepare for recruiting events, interviews, and a career in the accounting profession
What will be the return on the portfolio a : Assume that a three-factor APT describes the returns of all well-diversified portfolios, and that the three factors are unexpected changes in production (factor
Determine the return on stockholders equity : Average common stockholders' equity 1,465,263. Determine (a) the return on stockholders' equity and (b) the return on common stockholders' equity
What are the operating cash flows in year : Johnny's Lunches is considering purchasing a new, energy-efficient grill. The grill will cost $46,000 and will be depreciated straight-line over 3 years.
Draw the payoff diagram for these call options : Draw the payoff diagram for these call options, labeling the strike price, breakeven point, and profit area.
Determine the asset turnover ratio : A company reports the following: Average total assets (excluding long-term investments) 620,500. Determine the asset turnover ratio
Describe target capital budgeting process : Describe Target's capital budgeting process and evaluate it. While doing so, discuss the role of the real-estate managers & CEC (Capital Expenditure Committee),
What are the average collection period : What are the Average Collection Period, Net Profit Margin, Total Asset Turnover, and Equity Multiplier for McDonalds and Wendys for FY2019 and FY2020?

Reviews

Write a Review

Finance Basics Questions & Answers

  Financial reporting and analysis

Finance is about Gunns Ltd, a company in dealing with forestry products in Australia. The company has also been listed in Australian Stock Exchange. As many companies producing forestry products, even Gunns Ltd is facing various problems. Due to the ..

  A report on financial accounting

This report is specific for a core understanding for Financial Accounting and its relevant factors.

  Describe the types of financial ratios

Describe the types of financial ratios and other financial performance measures that are used during venture's successful life cycle.

  Differences between sole proprietorship and corporation

Briefly describe the major differences between a sole proprietorship and a corporation

  Prepare a cash budget statement

Calculate the expected value of the apartment in 20 years' time. What is the mortgage loan repayment at the beginning of each month

  What are the implied interest rates

What are the implied interest rates in Europe and the U.S.?

  State pricing theory and no-arbitrage pricing theory

State pricing theory and no-arbitrage pricing theory

  Small business administration

Identify the likely stage for each venture and describe the type of financing each venture is likely to be seeking and identify potential sources for that financing.

  Effect of financial leverage

The Effect of Financial Leverage and working capital management

  Evaluate the basis for the payment to the lender

Evaluate the basis for the payment to the lender and basis for the payment to the company-counterparty.

  Importance of opps, ipps, mpfs and dmepos

Research and discuss the differences and importance of : OPPS, IPPS, MPFS and DMEPOS.

  Time value of money

Time Value of Money project

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