What is the project discounted payback

Assignment Help Financial Management
Reference no: EM131609632

Fernando Designs is considering a project that has the following cash flow and WACC data. What is the project's discounted payback?

WACC:10.00%

Year 0 1 2 3

Cash flows -$650 $500 $500 $500

a. 1.62 years

b. 1.58 years

c. 1.15 years

d. 1.47 years

e. 1.24 years

Reference no: EM131609632

Questions Cloud

What is the component cost of debt : What is the component cost of debt for use in the WACC calculation?
What will be required return on your portfolio : what will be the required return on your $5.5 million portfolio?
Considering replacing progressive tax system with flat tax : Estoluania is considering replacing its progressive tax system with a flat tax that would raise equal revenue.
Technique would be needed to perform a replacement analysis : Without performing further calculations what technique would be needed to perform a replacement analysis?
What is the project discounted payback : Fernando Designs is considering a project that has the following cash flow and WACC data. What is the project's discounted payback?
Describes termination liability on contract : Which one of the following best describes termination liability on a contract?
Present value method-calculate the apv of the project : The corporate tax rate is 30 percent. Using the adjusted present value method, calculate the APV of the project.
Determine maximum deviation allowable in cost of capital : determine the maximum deviation allowable in the cost of capital estimate that leaves the investment decision unchanged.
What is the current share price of your stock : Ignoring taxes, what is the current share price of your stock? What would your cash flow be for each year for the next two years?

Reviews

Write a Review

Financial Management Questions & Answers

  Whats the value of building the plant

Acme Industries is considering building a plant that will have a value after two years. The cash flows from the plant will be $200 million following two good years, $150 million following one good and one bad year, and $100 million following two bad ..

  Internal control on financial reporting

The management's report on ICFR (internal control on financial reporting) issued by management includes

  Single currency for the world would be beneficial

International trade agreements eliminate trade barriers between countries, promote investments, infuse competitiveness, enhance productivity, create jobs, and provide consumers with a greater range of options at cheaper prices.

  Prepare an estimate of the required financing

Rusty Spears, CEO of Rusty's Renovations, a custom building and repair company, is repair documentation for a line of credit request from his commercial bankr. Prepare a monthly cash budget for the last 6 month of 2014. Prepare an estimate of the req..

  What are your allowable tax depreciation amounts

You purchased a commercial building and lot for $200,000 on May 3th, 2014. The lot itself was valued at $80,000 when purchased. You sold the lot and building for $350,000 on Feb 15th of 2015. Use MACRS depreciation and note that this property is cons..

  What is your best estimate of the company cost of equity

If the stock sells for $37 per share, what is your best estimate of the company's cost of equity?

  Why is important organizational information system

What is and why is important Organizational Information System? What are physical pooling, notional pooling, and bank overlay structure?

  Carlson machine shop is considering a four-year project to

carlson machine shop is considering a four-year project to improve its production efficiency by purchasing a new

  Stock price of fairfax pizza expected to be in one year

Fairfax Pizza stock is currently priced at 87.48 dollars per share and is expected to pay its next dividend, which is expected to be 2.34 dollars, in 1 year. The stock has a beta of 0.63. The market has an expected return of 16.39 percent, the risk-f..

  Loan amortization and ear

LOAN AMORTIZATION AND EAR You want to buy a car, and a local bank will lend you $20,000. The loan will be fully amortized over 5 years (60 months), and the nominal interest rate will be 12% with interest paid monthly. What will be the monthly loan pa..

  Use for preferred stock in the computation

FarCry Industries, maker of telecommunications equipment, What weight should you use for preferred stock in the computation of FarCry’s WACC?

  Calculate the current price of bond-current yield of bond

You are considering purchasing a General Electronic bond that has a compound rate of 6 %, per value of 1000 & a maturity of 25 yrs. The bond is callable for 10 yrs & if the bond is called you will be paid a premium of &100 over pay. The yield to matu..

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