Write a report for kerry melrose

Assignment Help Accounting Basics

Reference no: EM131201867

Practice questions:

Kerry Melrose has a conference organising business and is thinking of buying some computer-controlled audio visual equipment. She has done her calculations on a cash basis and has discovered that the equipment will cost £10,000. At the end of the first year she will have to spend £5,000 on training and advertising, and this should generate an additional £1,000 worth of business. I n the second year, she estimates that the advertising costs will reduce to £3.000, but an additional £2,000 worth of business will be generated. In the third and fourth years no advertising will be required and the additional business generated will be £3,000 in year 3 and £8,000 in year 4. Kerry believes that by the end of year 5 the equipment will be out of date, but she should be able to generate a further £6,000 worth of business in that year and be able to sell the equipment at the end of the year for £4,000.

Write a report for Kerry Melrose which shows:

a. the payback period of the project

b. the net present value of the project using a discount rate of 12%

c. an explanation of the two techniques, and an interpretation of their results

d. your recommendation as to whether Kerry should go ahead with the project. and any financial considerations she should bear in mind.

Reference no: EM131201867

Questions Cloud

Which one is appropriate to use during the given situations : We must know and understand all three behavioral options and choose which one is appropriate to use during situations. When you placed in a situation, do you process the situation before you speak or react?

What about the international fischer effect : If trade barriers were completely removed and there were no government intervention between the United States and China, would the Purchasing Power Parity (PPP )be more likely to hold between the two countries? What about the International Fischer..

Calculate the rate of mass transfer of water into the air : The value for the diffusivity of water vapor in air is 0.22 cm2/s at 0°C and 1 atm. The mass velocity of air is taken relative to the pipe wall.

Assignment-budget planning and control : Babycakes, a specialty bakery, is the company that will be considered for all parts of your budget planning and control report. For this assignment, you will develop a three to four (3 - 4) page paper in which you address the following.

Write a report for kerry melrose : Write a report for Kerry Melrose which shows: the payback period of the project, the net present value of the project using a discount rate of 12%

What is the reason behind this : Geotechnical Instrumentation is frequently employed for monitoring the condition of reclamation. Sometimes two piezometers are installed inside the same borehole. What is the reason behind this?

Which project should the management choose and why : Farmer George Tractors Ltd has £500,000 to invest. -- Which project should the management choose, and why?

Importance of geotextiles and sand in reclamation works : What is the importance of geotextiles and sand in reclamation works?

Raft foundation of pumping stations : Why are voids filled with lightweight infilling material in raft foundation of pumping stations?

User Account

All Pages