What is project a payback

Assignment Help Finance Basics
Reference no: EM132724681

Bellinger Industries is considering two projects for inclusion in its capital budget, and you have been asked to do the analysis. Both projects' after-tax cash flows are shown on the time line below. Depreciation, salvage values, net operating working capital requirements, and tax effects are all included in these cash flows. Both projects have 4-year lives, and they have risk characteristics similar to the firm's average project. Bellinger's WACC is 11%.

0 1 2 3 4
Project A -1,100 600 390 240 290
Project B -1,100 200 325 390 740
What is Project A's payback? Do not round intermediate calculations. Round your answer to four decimal places.
years
What is Project A's discounted payback? Do not round intermediate calculations. Round your answer to four decimal places.
years
What is Project B's payback? Do not round intermediate calculations. Round your answer to four decimal places.
years
What is Project B's discounted payback? Do not round intermediate calculations. Round your answer to four decimal places.
years

Reference no: EM132724681

Questions Cloud

Calculate the deduction that will be allowed : Calculate the deduction that will be allowed under s 11(a) for the cows bought during the year of assessment
Calculate after-tax cash flow at disposal : Calculate After-Tax Cash Flow at disposal. Round the answer to two decimals.
Computation of farcry wacc : What weight should you use for debt in the computation of FarCry's WACC? (Round your answer to 2 decimal places.)
How much is the venture income : How much is the venture income? Explain the answer. R, S and T formed a joint venture. R is to act as manager and is designated to record the joint
What is project a payback : Bellinger Industries is considering two projects for inclusion in its capital budget, and you have been asked to do the analysis. Both projects' after-tax cash
Discuss otitis externa to include differential diagnoses : Discuss otitis externa to include three differential diagnoses (DD), clinical presentation and physical exam findings, management, complications
Prepare a schedule of cost of goods manufactured : Assume the ending raw materials inventory is $1,400 and the company does not use any indirect materials. Prepare a schedule of cost of goods manufactured
What is the issue current yield : Assuming that the call value and the maturity value are the same, what is the issue's current yield?
How would consolidated net income be allocated : Placid Lake Corporation acquired 90 percent, how would consolidated net income be allocated to the controlling and noncontrolling interest?

Reviews

Write a Review

Finance Basics Questions & Answers

  Identify the applicable operation components

Operations Section In the operations section, identify the applicable operation components that may include facilities, inventories, capacity, distribution channels, technology, and quality control. Develop your operational budget to incorporat..

  Under which policy will external financing be minimized

Under which policy will external financing be minimized

  Find the nvp for project

a. Find the NVP for each project. (I have calculated this) b) Find the breakeven cash inflow for each project (Need Help)

  What is the weighted average life

You have a portfolio with an average duration of 6.5 years and a value of $1 million. If interest rates rise by 150 basis points, what will be the approximate value of your portfolio if you make no changes?

  What is the break-even point in bags

The fixed costs of this operation are $80,000, while the variable costs of grapes are $0.10 per pound.

  What would be the investment future value

What would be the investment ‘s future value in term of purchasing power if inflation occurs at 9% annual rate

  What are some ideas for a procurement

What are some ideas for a procurement, operations, and marketing strategy?

  Find the cost of common equity and wacc

Palencia Paints Corporation has a target capital structure of 45% debt and 55% common equity, with no preferred stock. Its before-tax cost of debt is 12%.

  Evaluates the given types of choices over a life

A pharmaceutical company is evaluating the options for the manufacture of a chemical component in one of its drugs. There are three different locations.

  Explain the meaning of managerial flexibility

Explain the meaning of "managerial flexibility" and assess its significance in relation to other factors that are also important to project evaluation.

  What would you advise the firm to consider in making

Based on our discussion in the Aspen case, what would you advise the firm to consider in making this decision

  Company depreciation and amortization expense

The company has $6,900 interest expense, and the corporate tax rate is 35 percent. What was the company's depreciation and amortization expense?

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