What cash flow must the investment provide

Assignment Help Accounting Basics
Reference no: EM133127164

Question - You have been offered a 5-year investment at a price of $83,777.68. It will pay $10,250 at the end of Year 1, $21,750 at the end of Year 2, and a fixed but currently unspecified cash flow, X, at the end of Years 3 through 5. The payer is essentially riskless, so you are sure the payments will be made, and you regard 3% as an appropriate rate of return on riskless 5-year investments. What cash flow must the investment provide at the end of each of the final 3 years, that is, what is X?

Reference no: EM133127164

Questions Cloud

Calculate the cost of national defense per person : Calculate the cost of national defense per person in 2001. Explain why it is difficult to charge individuals their "fair share" of the cost of national defense.
Time value of money internet search : Search the Internet for any short article related to our topics this week of time value of money.
Optimal level of bottled water consumption : b. Derive the marginal social cost MSC. What would be the socially optimal level of bottled waterconsumption? Illustrate your answer on the graph that you drew
Effective health information communication methods : What are 5 effective health information communication methods? What are the advantages and disadvantages of these methods?
What cash flow must the investment provide : Question - You have been offered a 5-year investment at a price of $83,777.68. What cash flow must the investment provide
Eliminate shortages and stockouts : Why wouldn't a company always store large quantities of inventory to eliminate shortages and stockouts?
Record credit sales and the allowance for doubtful accounts : Assume that C&S had total credit sales (before allowances) of $1,400,000 in 2016. Record credit sales and the allowance for doubtful accounts
Explain the different levels of production : A firm has the following marginal costs at different levels of production. If it is able to sell al the products it can produce at $5 each, how many will it pro
Discuss the view that price floors are more effective : Discuss the view that price floors are more effective than subsidies in providing assistance to producers in the agricultural sector.

Reviews

Write a Review

Accounting Basics Questions & Answers

  What is your investment recommendation

ROSS estimates a 25% probability for a successful exit, with an expected exit time in 3 years. What is your investment recommendation

  Calculate the overhead rate based on traditional overhead

Surfs Up manufactures surfboards. Calculate the overhead rate based on traditional overhead allocation with direct labour hours as the base

  What is the total cost that would be assigned

What is the total cost that would be assigned to Eudora's finished goods inventory at the end of the first year of operations under the variable costing method

  Compute the depreciation expense in year two

The machine's useful life is estimated to be 8 years with a $5,000 salvage value. Compute the depreciation expense in year two

  The term legal level of budgetary control

What is meant by the term legal level of budgetary control ? Cite some examples.

  Marvinu2019s music company was incorporated as a new

marvinu2019s music company was incorporated as a new business on january 1 2012. the company is authorized to issue

  Calculate net cash flow from operating activities

The December 31, 2019 balance in accounts receivable represents an increase of $19,000 over last year balance. Calculate net cash flow from operating activities

  What is the present value of this liability

Johnson, Inc., has an unfunded pension liability of $475 million that must be paid in 20 years. What is the present value of this liability

  What is the amount of amortization to pension expense

The average remaining service period for the employees expected to receive benefits is 10 years. What is the amount of amortization to pension expense

  How many semiannual interest payments will be made

On the issue date, the annual market rate for the bonds is 8%. How many semiannual interest payments will be made on these bonds over their life?

  Smitty museum purchased the copyright to a piece of artwork

smitty museum purchased the copyright to a piece of artwork for 922000. smitty plans to reproduce 1.8 million posters

  What is the total amount of current liabilities at December

Sold equipment for $207,000 cash (not including sales tax). What is the total amount of current liabilities at December 31, 2018

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