Work out the npv for pintos project

Assignment Help Managerial Accounting

Reference no: EM133342147

Pinto Corp. is considering the purchase of a major piece of equipment for its Winnipeg manufacturing plant. The project would cost $22m in initial investment and would result in cost savings, before tax, of $3.25m per year for five years. The equipment could be sold for $4.5m at the end of the five years. The company's CCA rate is 25% and the corporate tax rate is 34%. The company's required rate of return is 11%. Using the tax shield approach, work out the NPV for Pinto's project

Reference no: EM133342147

Questions Cloud

What price does the tyler bond sell : per year, compounded semiannually. Coupon payments are made semiannually. At what price does the Tyler bond sell

Research the historical data pertaining to the major hazards : Next, use the Internet to research the historical data pertaining to the major hazards and risks that have occurred there.

Compute the value of the jefferson bond : Coupon payments are made semiannually. Other similar bonds offer 5.50% per year, compounded semiannually. Compute the value of the Jefferson bond

Principles of change theory : Compare and contrast principles of Change Theory and Motivational Interviewing and how these principles inform therapeutic interventions

Work out the npv for pintos project : The company's required rate of return is 11%. Using the tax shield approach, work out the NPV for Pinto's project

How can mobility promote healthy lifestyle : Mobility can have either a positive or negative impact on our patient's lives. How can mobility promote a healthy lifestyle?

What accounting qualitative factors should company consider : What accounting qualitative factors should the Company consider? Enumerate at least three and advise Christmas Corp. briefly

Completion of an incident report-a thorough investigation : As you drive to the scene, you begin to mentally review all of the elements that go into the completion of an incident report and a thorough investigation.

Calculate the impact on contribution margin : Calculate the impact on contribution margin of accepting the order and conclude if the order should be accepted to maximize short term profit

User Account

All Pages