An investment that costs $50,000 will return $15,000 operating cash flows per year for five years. Determine
Question:
An investment that costs $50,000 will return $15,000 operating cash flows per year for five years. Determine the net present value of the investment if the required rate of return is 14 percent. Should the investment be undertaken? (Your answer might be slightly different due to rounding. Select the best answer from those available.)
A. Yes, the profit is $25,000.
B. No, the accounting return is less than 14%.
C. No, the net present value is negative at $11,045.
D. Yes, the net present value is positive at $1,496.50.
What is NPV? The net present value is an important tool for capital budgeting decision to assess that an investment in a project is worthwhile or not? The net present value of a project is calculated before taking up the investment decision at...
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 76% (13 reviews)
D Yes the net present value is posi...View the full answer
Answered By
Ashington Waweru
I am a lecturer, research writer and also a qualified financial analyst and accountant. I am qualified and articulate in many disciplines including English, Accounting, Finance, Quantitative spreadsheet analysis, Economics, and Statistics. I am an expert with sixteen years of experience in online industry-related work. I have a master's in business administration and a bachelor’s degree in education, accounting, and economics options.
I am a writer and proofreading expert with sixteen years of experience in online writing, proofreading, and text editing. I have vast knowledge and experience in writing techniques and styles such as APA, ASA, MLA, Chicago, Turabian, IEEE, and many others.
I am also an online blogger and research writer with sixteen years of writing and proofreading articles and reports. I have written many scripts and articles for blogs, and I also specialize in search engine
I have sixteen years of experience in Excel data entry, Excel data analysis, R-studio quantitative analysis, SPSS quantitative analysis, research writing, and proofreading articles and reports. I will deliver the highest quality online and offline Excel, R, SPSS, and other spreadsheet solutions within your operational deadlines. I have also compiled many original Excel quantitative and text spreadsheets which solve client’s problems in my research writing career.
I have extensive enterprise resource planning accounting, financial modeling, financial reporting, and company analysis: customer relationship management, enterprise resource planning, financial accounting projects, and corporate finance.
I am articulate in psychology, engineering, nursing, counseling, project management, accounting, finance, quantitative spreadsheet analysis, statistical and economic analysis, among many other industry fields and academic disciplines. I work to solve problems and provide accurate and credible solutions and research reports in all industries in the global economy.
I have taught and conducted masters and Ph.D. thesis research for specialists in Quantitative finance, Financial Accounting, Actuarial science, Macroeconomics, Microeconomics, Risk Management, Managerial Economics, Engineering Economics, Financial economics, Taxation and many other disciplines including water engineering, psychology, e-commerce, mechanical engineering, leadership and many others.
I have developed many courses on online websites like Teachable and Thinkific. I also developed an accounting reporting automation software project for Utafiti sacco located at ILRI Uthiru Kenya when I was working there in year 2001.
I am a mature, self-motivated worker who delivers high-quality, on-time reports which solve client’s problems accurately.
I have written many academic and professional industry research papers and tutored many clients from college to university undergraduate, master's and Ph.D. students, and corporate professionals. I anticipate your hiring me.
I know I will deliver the highest quality work you will find anywhere to award me your project work. Please note that I am looking for a long-term work relationship with you. I look forward to you delivering the best service to you.
3.00+
2+ Reviews
10+ Question Solved
Related Book For
Managerial Accounting for Managers
ISBN: 978-1259578540
4th edition
Authors: Eric Noreen, Peter Brewer, Ray Garrison
Question Posted:
Students also viewed these Managerial Accounting questions
-
If the firms required rate of return is 14 percent, what is the net present value of the following project? Year Cash Flow 0 .......... $(75,000) 1 .......... 50,000 2 .......... 40,000
-
If the expected net present value of returns from an investment project is $50,000, what is the maximum price that a risk-neutral investor would pay for it? Explain.
-
A companys sales dropped 10% per year for five years. a. What annual rate of sales growth for the subsequent five years would return the sales to the original level? b. To the nearest month, how long...
-
A lightweight, rigid beam 10.0 m long is supported by a cable attached to a spring of force constant k = 8.25 kN/m as shown in Figure P12.38. When no load is hung on the beam (Fg = 0), the length L...
-
Let F be as in Problem 19. Calculate Where (a) C is the ellipse x2 / 9 + y2 / 4 = 1 (b) C is the square the vertices (1, - 1), (1, 1), (-1, 1), and (-1, -1). (c) C is the triangle with vertices (1,...
-
Compute the matrix norm corresponding to the l -vector norm for the coefficient matrix: In Prob. 17 Data from Prob. 17 Solve 42x 1 + 74x 2 + 36x 3 = 96 -46x 1 - 12x 2 - 2x 3 = 82 3x 1 + 25x 2 + 5x 3...
-
What the procedures are for a third-party stakeholder to deposit funds with the court?
-
On July 1, 2014, Witherspoon Satellites issued $4,500,000, 9%, 10-year bonds at $4,219,600. This price resulted in an effective-interest rate of 10% on the bonds. Wither-spoon uses the...
-
NPV and IRR Analysis Cummings Products Company is considering two mutually exclusive investments whose expected net cash flows are as follows: EXPECTED NET CASH FLOWS Year Project A Project B 0 -$280...
-
Ian Manufacturing Company was organized five years ago and manufactures toys. Its most recent three years' balance sheets and income statements are reproduced below: A reconciliation of retained...
-
At an activity level of 6,000 units the cost for maintenance is $7,200 and at 10,000 units the cost for maintenance is $11,600. Using the high-low method, the cost formula for maintenance is: a....
-
Bonnie purchased a new business asset (five-year property) on March 10, 2007, at a cost of $20,000. She also purchased a new business asset (seven-year property) on November 20, 2007, at a cost of...
-
In the current year, Nighthawk Corporation, a calendar year C corporation, has $3,700,000 of adjusted taxable income, $125,000 of business interest income, zero floor plan financing interest, and...
-
Discuss the complexities involved in international financial management, including foreign exchange risk management, global capital budgeting, and cross-border investment strategies.
-
5. Solve the equations AX=Y, where: 13 -8 -3 [20 X1 10-1,Y=-5, X = X2 A=-8 -3-1 -1 11 0 X3 Attach the results
-
how do you know which equation to use for sustainable growth? There are several: g*=PRAT g*= R x ROEbop g* = change in equity / equity bop g*= R x Earnings / Equity What is the formula for Actual...
-
What are the implications of incorporating machine learning algorithms, such as deep learning neural networks, in the identification and mitigation of operational risks within large-scale financial...
-
How can I overcome the challenges of measuring marketing effectiveness?
-
A heat exchanger is being used to cool 48,000 lbm/hr of oil from 150F to 102F by using 32,000 lbm/hr of water at an inlet temperature of 70F. The overall heat transfer coefficient is determined to be...
-
Two mutually exclusive investment alternatives are being considered. Alternative A requires an initial investment of $20,000 in a machine. Annual operating and maintenance costs are anticipated to be...
-
Give three examples of asymmetric information in which the health consumer has information that is unavailable to the health provider. Give three concrete examples in which the health provider has...
-
On July 12, Reliable Repair Service extended an offer of $150,000 for land that had been priced for sale at $185,000. On September 3, Reliable Repair Service accepted the sellers counteroffer of...
-
On July 12, Reliable Repair Service extended an offer of $150,000 for land that had been priced for sale at $185,000. On September 3, Reliable Repair Service accepted the sellers counteroffer of...
-
On July 12, Reliable Repair Service extended an offer of $150,000 for land that had been priced for sale at $185,000. On September 3, Reliable Repair Service accepted the sellers counteroffer of...
-
Identify the differences between experimental andnonexperimental research designs. Give an example of each type ofdesign.
-
Some examples of social norms that students have violated aresitting with strangers at the same table at the food court in themall, men wearing lipstick and nail polish, going into therevolving door...
-
how fix this error import java.util.*; import java.lang.*; import java.io.*; import java.lang.Math; publicclass Main { publicstaticint leftrightString(String S) { //this is default OUT int result =0;...
Study smarter with the SolutionInn App