What are the operating cash flows in years

Assignment Help Finance Basics
Reference no: EM132444544

Cash Flows and NPV. Johnny s Lunches is considering purchasing a new, energy-efficient grill. The grill will cost $40,000 and will be depreciated according to the 3-year MACRS schedule. It will be sold for scrap metal after 3 years for $10,000. The grill will have no effect on revenues but will save Johnny s $20,000 in energy expenses. The tax rate is 35%.

a. What are the operating cash flows in Years 1 3?

b. What are total cash flows in Years 1 3?

c. If the discount rate is 12 percent, should the grill be purchased?

Reference no: EM132444544

Questions Cloud

Explain what constitutes the practice of barbering : Discuss the necessity of a permit for persons and entities who wish to conduct business and perform the art of barbering.Explain what constitutes the practice
What are the high-risk behaviors exhibited by the family : What are the high-risk behaviors exhibited by this family? Discuss gender and family roles in the context of traditional Puerto Rican culture.
Hedge against interest rates becoming very volatile : Describe in words how a business could hedge against interest rates becoming very volatile.
What is the recommended dosage : Case Study: L.L. is a 67-year-old male who has been diagnosed with BPH. He is having difficulty with urination. He is currently on Cozaar 100 mg for HTN.
What are the operating cash flows in years : a. What are the operating cash flows in Years 1 3? b. What are total cash flows in Years 1 3?
Analyze how barbershop permits are issued : Analyze how barbershop and barber school permits are issued. How are applicants from other states accommodated? How are the permits to be displayed
The methods that ikea uses to deal with external stressors : How might the methods that IKEA uses to deal with external stressors, such as global economic and political conditions,
Calculate the after-tax cost of debt : Calculate the after-tax cost of debt, the cost of preferred stock and the cost of common stock using the information above.
About your industry competitiveness : Assume you are the CEO of any organization of your choice. What would you want to know about your industry competitiveness?

Reviews

Write a Review

Finance Basics Questions & Answers

  Narrative with supporting statistical output

Reminder: The format of this SPSS assignment should be narrative with supporting statistical output (table and graphs) integrated into the text in the appropriate places (not all at the end of the document).

  What are the futures prices

Using a cost-of-carry model, estimate the implied storage cost (using a continuously compounded rate) for the August 2016 crude oil contract. Use a risk-free rate of 0.37% continuously compounded per year, and assume that expiration is at the end of ..

  What is the beta of the supply of omega electronics

What is the beta of the supply of Omega Electronics Establish the trademark line for the supply of Omega Electronics.

  What is the required rate of return on the preferred stock

Grant Hillside Homes has preferred stock outstanding that pays an annual dividend of $12.20. Its price is $126.

  Would there be positive interest rates on bonds in a world

would there be positive interest rates on bonds in a world with absolutely no risk no default risk maturity risk and so

  Compute the future dollar costs of meeting the obligation

Princess Cruise Company (PCC) purchased a ship from Mitsubishi Heavy Industry for 500 million yen payable in one year. The current spot rate is ¥124/$.

  Financial risk of investment in a company

A variety of bond and stock rating agencies exist that provide both qualitative and quantitative factors that relate to the financial risk of investment in a company.

  Calculate quicker cost of goods completed for may

Quicker Company uses a job order costing system. On May 1, Quicker Company's Work in Process Inventory account shows a beginning balance of $161,000.

  Concerns with properly controlling flow

Explain this use in your current place of employment or an organization you are familiar with. Describe concerns with properly controlling this flow, including keeping it safe from unauthorized use.

  Why do options prices rise the further out

What is the difference in price between the call and put options for this month, next month, and this month next year?

  Calculate the current share price

The required rate of return on the shares in the firms identified in parts (i) to (ii) is 15% per annum (discount rate). Calculate the current share price in each part.

  Estimation of company cost of capital

Discuss how to and then perform a quantitative analysis and subsequently recommend the optimal capital structure mix for Berkshire Hathaway Inc. based on a 20 percent increase in assets.

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