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Your company is thinking about acquiring another corporation. You have two choices—the cost of each choice is $250,000. You cannot spend more than that, so acquiring both corporations is not an option. The following are your critical data:Corporation ARevenues = $100,000 in year one, increasing by 10% each yearExpenses = $20,000 in year one, increasing by 15% each yearDepreciation expense = $5,000 each yearTax rate = 25%Discount rate = 10%Corporation BRevenues = $150,000 in year one, increasing by 8% each yearExpenses = $60,000 in year one, increasing by 10% each yearDepreciation expense = $10,000 each yearTax rate = 25%Discount rate = 11%Compute and analyze items (a) through (d) using a Microsoft® Excel® spreadsheet. Make sure all calculations can be seen in the background of the applicable spreadsheet cells. In other words, leave an audit trail so others can see how you arrived at your calculations and analysis. Items (a) through (d) should be submitted in Microsoft® Excel®; indicate your recommendation (e) in the Microsoft® Excel® spreadsheet; the paper stated in item (f) should be submitted consistent with APA guidelines.a. A 5-year projected income statementb. A 5-year projected cash flowc. Net present value (NPV)d. Internal rate of return (IRR)e. Based on items (a) through (d), which company would you recommend acquiring?f. Write a paper of no more 1,050 words that defines, analyzes, and interprets the answers to items (c) and (d). Present the rationale behind each item and why it supports your decision stated in item (e). Also, attempt to describe the relationship between NPV and IRR. (Hint. The key factor is the discount rate used.) In addition to the paper, a Micosoft® Excel® spreadsheet showing your projections and calculations must be shown and attached.
In order to calculate the volume variance and break it down in enrollment and utlization components, how many flexible budgets must be constructed?
Question 3 :Restful Industries has offered $12 million cash for all the ordinary shares in Sofa Distribution Pty Ltd. Based on recent market information, Sofa Distribution is worth $8 million as an independent operation. If the merger makes economic ..
Suppose you have 500 acres of timberland, with young timber worth $40,000 if logged now. This represents 1,000 cords of wood worth $40 per cord net of costs of cutting and hauling.
Firm A had the following selected items on its balance sheet.
Assume that the firm has adequate operating income against which to deduct any loss experienced on the sale of the existing machine. The firm has a 9% cost capital and is subject to a 40% tax rate.
You have 50000 in your 401k. You estimate you can fund the account about 10000 annually at the end of each year. Your 401k is expected to earn about 10% annually. You plan to retire in 20 years and want 100000. will you meet your goal?
In the last few years, there have been many news stories about financial misdeeds of some major corporations, from Enron to Goldman Sachs.
If a new technologist aide is hired, what is the monthly patient volume needed at the original reimbursement rate to cover variable costs, but not profit?.
stocks coefficient of variation required rate return and risk analysisstock x has a 10 expected return a beta
A stock expects to pay it's first ever dividend of $1 five years from today. From that point onward, dividends are expected to grow by 10% per year forever. What is the fair price for this stock if it has a required return of 14%?
Research and identify the current levels of the real and nominal GDP, unemployment rate, the inflation rate and the key interest rate. Relate these variables to the current state of the economy.
The respective future cash inflows from its project for years 1,2,3,4 and 5 are: $15,000, $25,000, $35,000, $45,000, and $55,000. Lennon uses the internal rate of return method to evaluate projects. What is Lennon's IRR?
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