Which of the following statments concerning the change

Assignment Help Finance Basics
Reference no: EM13300514

JB enterprises purchased a new molding machine for $75,000. The company paid $6,000 for the shipping and another $4,000 to get the machine integrated with the companyes existing assets.The company purchased a supply of oil for $2,000. The machine was to be deptreciated on a straight line basis over its expected useful life of 10 years. JB is replacing an old machine that was purchased 7 years ago for $50,000. The old machine was being depreciated on a a straight line basis over a 10 year expected life. The machine was sold for $10,000. JB's marginal tax rate is 40%. What is the amount of the initial outlay?


A) $75,000


B) $77,000


C) $81,000


D) $85,000

Which of the following statments concerning the change in working capital is most accurate?


A). The $2,000 paid for oil is added to the initial outlay, offset by the tax savings of $800


B) The $2,000 may be expensed each year over the life of the project as part of the incremental free cash flows


C) The $2,000 is added to the initial outlay and recaptured during the terminal year, hence having no impact on the projects NPV or IRR


D) Even if the $2,000 is fully recovered at the end of the project, the projects NPV and IRR will be lower if the change in working capital is included in the analysis.

Reference no: EM13300514

Questions Cloud

How to the equilibrium partial pressures of c2h6 : Calculate the equilibrium partial pressures of C2H6, N2, NH3, and C2H4. Peq(C2H6) = . Peq(N2) = . Peq(NH3) = . Peq(C2H4) = . (b) Calculate KP for this reaction. KP =
At what price is the maintenance margin first violated : At what price is the maintenance margin first violated, assuming that there is no interest or dividends paid to or from the margin account?
Determine the resonance angular frequency of the system : A 1.90-kg object attached to a spring moves without friction (b = 0) and is driven by an external force given by the expression F = 3.20sin(2?t), Find the resonance angular frequency of the system
Determine what is speed of the car as it passes the light : If the motorist wishes to pass the light just as it turns green without having to stop, what is the required uniform deceleration of the car and what is the speed of the car as it passes the light
Which of the following statments concerning the change : Which of the following statments concerning the change in working capital is most accurate?
Determine the time required for the particle to come to rest : Given: acceration = -k*sqrt(v) and k is a cosntant when x=0, v=81 m/s, t=0 when x=18 m, v=436 m/s determine: a) velocity of particle when x=20 m b) the time required for the particle to come to rest
What is the height of the marconi antennas for radio station : A Marconi antenna, used by most AM radio stations, consists of the top half of a Hertz antenna, What is the height of the Marconi antennas for radio stations broadcasting at 519 kHz
Determine distance the officer traveled before overtaking : The officer believes the driver is intoxicated and begins accelerating uniformly to 50 mi/h in 8 seconds and maintains a constant velocity of 60 mi/hr, overtakes the motorist 42 seconds after he passed the officer.
Female moral reform society : The New York Female Moral Reform Society (and its national successor, the American Female Moral Reform Society)

Reviews

Write a Review

Finance Basics Questions & Answers

  Financial reporting and analysis

Finance is about Gunns Ltd, a company in dealing with forestry products in Australia. The company has also been listed in Australian Stock Exchange. As many companies producing forestry products, even Gunns Ltd is facing various problems. Due to the ..

  A report on financial accounting

This report is specific for a core understanding for Financial Accounting and its relevant factors.

  Describe the types of financial ratios

Describe the types of financial ratios and other financial performance measures that are used during venture's successful life cycle.

  Differences between sole proprietorship and corporation

Briefly describe the major differences between a sole proprietorship and a corporation

  Prepare a cash budget statement

Calculate the expected value of the apartment in 20 years' time. What is the mortgage loan repayment at the beginning of each month

  What are the implied interest rates

What are the implied interest rates in Europe and the U.S.?

  State pricing theory and no-arbitrage pricing theory

State pricing theory and no-arbitrage pricing theory

  Small business administration

Identify the likely stage for each venture and describe the type of financing each venture is likely to be seeking and identify potential sources for that financing.

  Effect of financial leverage

The Effect of Financial Leverage and working capital management

  Evaluate the basis for the payment to the lender

Evaluate the basis for the payment to the lender and basis for the payment to the company-counterparty.

  Importance of opps, ipps, mpfs and dmepos

Research and discuss the differences and importance of : OPPS, IPPS, MPFS and DMEPOS.

  Time value of money

Time Value of Money project

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