What is the initial investment amount for this project

Assignment Help Financial Management

Reference no: EM131185022

Canvas Reproductions, Inc., has spent $4,500 dollars researching a new project. The project requires $20,000 worth of new machinery, which would cost $3,000 to install. The company would realize $4,500 in after-tax proceeds from the sale of old machinery. If Canvass working capital is unaffected by this project, what is the initial investment amount for this project?

Reference no: EM131185022

Questions Cloud

As part of your financial planning : As part of your financial planning, you wish to purchase a new car exactly 5 years from today. The car you wish to purchase costs $14,000 today, and your research indicates that its price will increase by 2% to 4% per year over the next 5 years. Esti..

Which of the conflict resolution technique is windstar using : Windstar is a large scale manufacturer which has more than 100 partners across the globe. When making decisions concerning distribution and channel optimization, the company invite members from its channel partners to be part of its advisory committe..

Decide to make the initial deposit today : You can deposit $10,000 into an account paying 9% annual interest either today or exactly 10 years from today. How much better off will you be at the end of 40 years if you decide to make the initial deposit today rather than 10 years from today?

How much is the total contractual allowance for each payer : As a follow-up to the previous Practice Exercise, new assumptions are as follows: 1. Your unit’s gross charges for the period to date amount to $200,000. 2. The uniform gross charge for each procedure in your unit is $100. 3. The unit receives revenu..

What is the initial investment amount for this project : Canvas Reproductions, Inc., has spent $4,500 dollars researching a new project. The project requires $20,000 worth of new machinery, which would cost $3,000 to install. The company would realize $4,500 in after-tax proceeds from the sale of old machi..

Use retained earnings without paying flotation cost : Firm can use retained earnings without paying a flotation cost. Therefore, while the cost of retained earnings is not zero, the cost of retained earnings is generally lower than the after-tax cost of debt financing. The capital structure that minimiz..

Calculate the after-tax cost of borrowing : Bella is interested in buying a new motorcycle. She has decided to borrow money to pay the $25,000 purchase price of the bike. She is in the 25% federal income tax bracket. Calculate the after-tax cost of borrowing from the motorcycle dealership. Cal..

What is the weight of debt for WACC purposes : Company X has 2 million shares of common stock outstanding at a book value of $2 per share. The stock trades for $3 per share. It also has $2 million in face value of debt that trades at 90% of par. What is the weight of debt for WACC purposes?

What is michelles affordable home purchase price : Michelle Duncan wants to know her affordable home purchase price. Her annual gross income is $44,400. She has $680 per month of other debt and expects her property taxes and homeowners insurance to cost $230 per month. She knows she can get a 9.50%, ..

User Account

All Pages