You will be able to reduce working capital

Assignment Help Financial Management

Reference no: EM131332679

Your firm is contemplating the purchase of a new $625,000 computer-based order entry system. The system will be depreciated straight-line to zero over its five-year life. It will be worth $69,000 at the end of that time. You will save $255,000 before taxes per year in order processing costs, and you will be able to reduce working capital by $84,000 (this is a one-time reduction). If the tax rate is 35 percent, what is the IRR for this project?

Reference no: EM131332679

Questions Cloud

Define law including contract and bankruptcy : Define Law including contract and bankruptcy - Explain how Adel will deal with this matter and which authorities he will approach to deal with this case.

Explanation of the skin disorder in the case study : An explanation of the skin disorder in the case study you selected. Include in your explanation the lesion type, lesion distribution, color, and any ancillary findings. Then, present a differential diagnosis and explain which is the most likely diagn..

What is appropriate required rate of return against : What is an appropriate required rate of return against which to evaluate the prospective IRRs from the Boeing 7E7? Please use the capital asset pricing model to estimate the cost of equity. At the date Of the case, the 74-year equity market risk prem..

What is your net profit on this position : You own 1000 shares of MMM that you bought for $152. You also have written 10 call option contracts on MMM, at a premium of $1.5 and with a strike price of $159, maturing in 2 months. If at maturity of the option, the stock price is $165, what is you..

You will be able to reduce working capital : Your firm is contemplating the purchase of a new $625,000 computer-based order entry system. The system will be depreciated straight-line to zero over its five-year life. It will be worth $69,000 at the end of that time. You will save $255,000 before..

Make a list of at least five trainings : Make a list of at least 5 trainings that you believe every law enforcement official should be required to take. Provide a 2-3 sentence description on each of the 5 training method explaining why you believe that specific training is necessary.

Depict this situation as a game with incomplete information : Depict this situation as a game with incomplete information.- Are the beliefs of Ronald and Jimmy consistent? -If you answered the above question positively, find the common prior.

Write a research paper about breast cancer : Write a research paper about breast cancer, a detailed look about it, what I need is as follows: Introduction, History, Statistics and epidemiology and Definition and classification

Projects by applying the npv decision rule : A firm evaluates all of its projects by applying the NPV decision rule. A project under consideration has the following cash flows: Year Cash Flow 0 –$ 27,200 1 11,200 2 14,200 3 10,200 What is the NPV for the project if the required return is 11 per..

User Account

All Pages