Find the net present value, Operation Management

Assignment Help:

The company is considering a capital expenditure of $480,000. It has an estimated life of 4 years and no salvage value. The estimated net income and new cash flow from the project are as follows:

Year 1 Net Income $90,000 Net Cash Flow $210,000

Year 2 Net Income 80,000 Net Cash Flow 200,000

Year 3 Net Income 40,000 Net Cash Flow 160,000

Year 4 Net Income 30,000 Net Cash Flor 150,000

Totals $240,000 $720,000

The company's minimum rate of return for net present value analysis is 15%. The present value of $1 at compound interest of 15% for 1, 2, 3, and 4 years is .870, .756, .658 and .572 respectively.

Determine:

a) the average rate of return on investment using straight line depreciation

b) the net present value

c) cash payback period (use actual forecasts, not averages).

NOTE: Please do not round


Related Discussions:- Find the net present value

Explain briefly the vrooms expectancy theory of motivation, Question 1: ...

Question 1: More and more organizations are showing greater reliance on team building and team work as opposed to individual work. Please discuss. i. Give characteristics o

Explain wastewater treatment plant, Visit the site: Wheaton, IL Sanitary Di...

Visit the site: Wheaton, IL Sanitary District. This tour of a wastewater treatment plant is an example of a high-volume, public project. • How is capacity defined at a wastewate

Compute the line efficiency of longest processing time, Balance the assembl...

Balance the assembly line in Exhibit 8.12 for (a) a shift output of 60 pieces and (b) a shift output of 40 pieces. Assume an eight-hour shift, and use the rule, choose the assignab

Explain authorities under the industrial disputes act, Explain the authorit...

Explain the authorities under the Industrial Disputes Act, 1947. Ans: One of the authorities under the Industrial Disputes Act, 1947 for investigation and settlement of indu

Explain the two types of linear programming discussed, Linear Programming C...

Linear Programming Concept paper. Submit a Linear Programming Concept Paper about the following 1. The two types of linear programming discussed. 2. Five examples of LP appli

Explain a relationship between the two variables, Boston Electric Generator...

Boston Electric Generators has been getting many complaints from its major customer, Home Station, about the quality of its shipments of home generators. Daniel Shimshak, the plant

Order winning and order qualifying criteria, 1. What you think might be the...

1. What you think might be the order winning and order qualifying criteria for: McDonald's, Southwest Airlines and a university?  Answer:

Explain the network is overloaded, Information asymmetry exists when - T...

Information asymmetry exists when - The network is overloaded - Sellers and buyers have the same information - One party in a transaction had more important information th

List the interesting gap between consumer & service provider, 1. Look at th...

1. Look at the above table and list the interesting gaps which you observe in the 'scripts' between consumer and service provider. Answer: 1. The starting point of the servic

Solution to the transportation problem, A transportation problem can be sol...

A transportation problem can be solved by two methods using (a) simplex methods and(b) transportation method. We shall illustrate these with the help of an example. Exam

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