User Account

All Pages

What is the net present value

Assignment Help Accounting Basics
Reference no: EM132454208

Problem - Mayflower Corp buys equipment for $95,000 that will last for 7 years. The equipment will generate cash flows of $22,000 per year and will have no salvage value at the end of its life. Ignore taxes. Use 16% required rate of return.

Required -

1. What is the present value (PV) of this investment at 16%?

2. What is the net present value (NPV) of this investment? Should Sampson Corp buy the equipment based on NPV? Justify your decision.

3. What is the internal rate of return (IRR) of this investment?

4. What is the payback period?

Reference no: EM132454208

Questions Cloud

BUSS 10001 Omani Business Environment Studies Assignment : BUSS 10001 Omani Business Environment Studies Assignment Help and Solution, Middle East College - Assessment Writing Service - Explain the form of business
Write review the elements systems engineering : Write Review the elements systems engineering,As the demand for systems and applications continue to grow, organizations are striving to get things
Assessing and improving ehr data quality : Write a 350- to 700-word paper that discusses the importance of maintaining high standards and integrity concerning EHR data quality.
Does denver have similar zones where people settle : Comment on any/all of these questions. What do you think? And what's your evidence? Does Denver have similar "zones" where people settle?
What is the net present value : What is the net present value (NPV) of this investment? Should Sampson Corp buy the equipment based on NPV? Justify your decision
How do demographic characteristics affect employees : How do demographic characteristics affect employees' preferences for a particular leadership style?
Experience with illness and disease : What is a personal analysis of your own experience with illness and disease and how several factors colored that experience?
Case study - automation and globalization : Case study - Automation and Globalization: How Industry 4.0 is affecting global business,What is the background to the case study?
Calculate Mize diluted earnings per share : On January 2, 2011, Mize Co. issued at par $300,000 of 9% convertible bonds. Calculate Mize's diluted earnings per share for 2011

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd