Can you show me how to solve these problems, Financial Accounting

Assignment Help:

Can you show me how to solve these problems? PLEASE!!! I can't figure out how to solve these. :-(

1.Briarcrest Condiments is a spice-making firm. Recently, it developed a new process for producing spices. The process requires new machinery that would cost $1,953,490. have a life of five years, and would produce the cash flows shown in the following table.
Year Cash Flow
1 $570,818
2 -230,748
3 819,690
4 908,962
5 734,805

What is the NPV if the discount rate is 15.25 percent? (Enter negative amounts using negative sign e.g. -45.25. Round answer to 2 decimal places, e.g. 15.25.)
NPV is $

2.Archer Daniels Midland Company is considering buying a new farm that it plans to operate for 10 years. The farm will require an initial investment of $12.10 million. This investment will consist of $2.50 million for land and $9.60 million for trucks and other equipment. The land, all trucks, and all other equipment is expected to be sold at the end of 10 years at a price of $5.17 million, $2.07 million above book value. The farm is expected to produce revenue of $2.07 million each year, and annual cash flow from operations equals $1.88 million. The marginal tax rate is 35 percent, and the appropriate discount rate is 9 percent. Calculate the NPV of this investment. (Round intermediate calculations and final answer to 2 decimal places, e.g. 15.25.)
NPV $
The project should be ___
3.Bell Mountain Vineyards is considering updating its current manual accounting system with a high-end electronic system. While the new accounting system would save the company money, the cost of the system continues to decline. The Bell Mountain's opportunity cost of capital is 13.8 percent, and the costs and values of investments made at different times in the future are as follows:
Year Cost Value of Future Savings
(at time of purchase)
0 $5,000 $7,000
1 4,200 7,000
2 3,400 7,000
3 2,600 7,000
4 1,800 7,000
5 1,000 7,000
Calculate the NPV of each choice. (Round answers to the nearest whole dollar, e.g. 5,275.)
The NPV of each choice is:
NPV0 = $
NPV1 = $
NPV2 = $
NPV3 = $
NPV4 = $
NPV5 = $
Suggest when should Bell Mountain buy the new accounting system?
Bell Mountain should purchase the system in .

4.Chip's Home Brew Whiskey management forecasts that if the firm sells each bottle of Snake-Bite for $20, then the demand for the product will be 15,000 bottles per year, whereas sales will be 88 percent as high if the price is raised 7 percent. Chip's variable cost per bottle is $10, and the total fixed cash cost for the year is $100,000. Depreciation and amortization charges are $20,000, and the firm has a 30 percent marginal tax rate. Management anticipates an increased working capital need of $3,000 for the year. What will be the effect of the price increase on the firm's FCF for the year? (Round answers to nearest whole dollar, e.g. 5,275.)
At $20 per bottle the Chip's FCF is $ and at the new price Chip's FCF is $ .

5.Capital Co. has a capital structure, based on current market values, that consists of 21 percent debt, 9 percent preferred stock, and 70 percent common stock. If the returns required by investors are 10 percent, 12 percent, and 17 percent for the debt, preferred stock, and common stock, respectively, what is Capital's after-tax WACC? Assume that the firm's marginal tax rate is 40 percent. (Round intermediate calculations to 4 decimal places, e.g. 1.2514 and final answer to 2 decimal places, e.g. 15.25%.)
After tax WACC= %

 

 


Related Discussions:- Can you show me how to solve these problems

What is recapitalization, Q. What is Recapitalization? Recapitalization...

Q. What is Recapitalization? Recapitalization - An internal reorganization of a corporation including a rearrangement of capital structure by changing the kind of stock or numb

Resolution for voluntary winding up-liquidation of companies, Resolution Fo...

Resolution For Voluntary Winding Up A company may be put into voluntary liquidation: 1) By ordinary resolution: where any period fixed for the duration of the company has ex

Financial accounts, The following items are found in the trial balance of M...

The following items are found in the trial balance of M/s Sharada Enterprise on 31st December, 2000. 10 marks Summer 2013 Sundry Debtors Rs.160000 Bad Debts written off Rs 9000 Dis

Illustration of pension funds, Normal 0 false false false ...

Normal 0 false false false EN-US X-NONE X-NONE MicrosoftInternetExplorer4

Determine the present value - annuity, Assume you are receiving an amount ...

Assume you are receiving an amount of Rs.5000 twice in a year for subsequent five years one time at the starting of the year and another amount of Rs. 5000 at the ending of the yea

Bank reconciliation statement, in bank reconciliation statement what are th...

in bank reconciliation statement what are the statement to be reconcile

Indian company, content of financial statement with refrence to indian comp...

content of financial statement with refrence to indian company

What do you mean by earnings per share, Q. What do you mean by earnings per...

Q. What do you mean by earnings per share? Anti-dilution - Condition which may increase computation of EARNINGS PER SHARE (EPS)or decrease loss per share solely due to the incl

Calculate the weighted average cost, The following information is available...

The following information is available about the capital structure of Cheng & Davis Development (CDD). Capital Structure Current Target

Financial leverage - ratio analysis, Provide a brief (one typed page) discu...

Provide a brief (one typed page) discussion of analysis of the ratios of your company versus the competitor and the industry, addressing your company's liquidity, solvency, profita

Write Your Message!

Captcha
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