What is the business worth today

Assignment Help Financial Accounting
Reference no: EM132950870

Question - You own a wholesale plumbing supply store. The store currently generates revenues of $1.03 million per year. Next? year, revenues will either decrease by 9.7% or increase by 4.9%?, with equal? probability, and then stay at that level as long as you operate the store. You own the store outright. Other costs run $890,000 per year. There are no costs to shutting? down; in that case you can always sell the store for $480,000. What is the business worth today if the cost of capital is fixed at 9.8%?

Reference no: EM132950870

Questions Cloud

How much is the current portion of the finance lease : The implicit interest rate is 8%. The cost and fair value of the asset is P1,733,201. How much is the current portion of the finance lease
Identify five sources of project risks : Identify five sources of project risks and define three of them.
Which of accounting treatment of costs related to business : Which of the accounting treatment of costs related to business combination is incorrect? The costs related to organization of the newly formed corporation
What is the expected loss per year : Med-Tech engineers are trying to improve the design of a pump shaft that has an outer diameter specification of 13 inches with a tolerance of ± 0.003 inch.
What is the business worth today : There are no costs to shutting? down; in that case you can always sell the store for $480,000. What is the business worth today if the cost of capital is fixed
What is the reliability of the engine : A jet engine has 11 components in series. The average reliability of each component is 0.988. What is the reliability of the engine?
Determine the level of reliability required : Determine the level of reliability required for each of the components if the engine is to have a reliability of 0.975.
How shall an acquirer in a business combination account : How shall an acquirer in a business combination account for the changes in fair value contingent consideration classified as equity instrument
What should be reported as variable expenses : Sheridan Company sells 50000 units for $15 a unit. Fixed costs are $350000 and net income is $100000. What should be reported as variable expenses

Reviews

Write a Review

Financial Accounting Questions & Answers

  What is the amount of the initial cash flow at year

If the new flange-lipper is purchased, what is the amount of the initial cash flow at Year 0? Round your answer to the nearest dollar.

  What amount should be reported in the income statement

Milo Company reported bonds payable of P12,000,000. What amount should be reported in the 2020 income statement as loss on early extinguishment of debt?

  Find the percent markup on cost for each computer

An Apple Computer store sells computers for $1,194.70. Assuming the computers cost $11,028 per dozen. Find the dollar markup for each computer. Find the percent markup on cost for each computer. Find the percent markup on selling price for each compu..

  How to calculate the company debt to assets ratio

How to calculate the company's debt to assets ratio for 2021 and 2022. Sandhill Co. has $1,040,000 in assets and $1,040,000 in stockholders' equity

  Scheduled to leave on three-week vacation

Meg Ryan, the bookkeeper of Logan Co., was scheduled to leave on a three-week vacation at 5:00 on Friday. She couldn’t get the company’s trial balance to balance. At 4:30, she decided to put in fictitious figures in her computer to make it balance. M..

  What the patent book value should be

In Hulou's Balance Sheet, the patent's book value should be? Hulou Co. spent $200,000 on research and developed a new testing device for early-stage cancer

  Disclosure of its nonrecurring revenue

Consult Paragraph 67 of PCAOB Auditing Standard No. 12. Do you believe that Qwest had established an effective system of internal control over financial reporting related to the presentation and disclosure of its nonrecurring revenue? Why or why not?

  Determine the amount of net income

Determine the amount of net income that Rhea and Sellevaeg would receive under each of the following independent assumptions.

  Compute for respective shares of partner on partnership loss

The partnership agreement of A, B and C stipulates, Compute for the respective shares of the partners on the partnership loss. Prepare table for each cases.

  Prepare pension worksheet and all journal entries

On January 1, 2020, Stine Co. had the following balances: Projected benefit obligation $7,200,000. Prepare pension worksheet and all journal entries

  Prepare the pre-acquisition entries only at July

The dividend liability at 1 July 2020 was paid in September 2020. Prepare the pre-acquisition entries only at 1 July 2020. Do not prepare BCVR entries

  Prepare a cash collections budget for the first quarter

Sunshine Corporation has found that 60% of its sales in any given month are credit sales, while the remainders are cash sales. Of the Credit sales, the company has experienced the following collection. Prepare a cash collections budget for the first ..

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