A company considers a project that will generate cash sales of P50,000 per year. Fixed costs will

Fantastic news! We've Found the answer you've been seeking!

Question:

A company considers a project that will generate cash sales of P50,000 per year. Fixed costs will be P10,000 per year, variable costs will be 40% of sales, and depreciation of the equipment in the project will be P5,000 per year. Taxes are 40%.

Required:

The expected annual cash flow to the company resulting from the project.

Related Book For answer-question

Foundations of Financial Management

ISBN: 978-1259194078

15th edition

Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen

See More Books

Posted Date: May 17, 2023 03:23 AM

See More Questions

NRW is keen to take advantage of this strength and is investigating a proposal to replace one of their outdated inefficient mining trucks with a new CAT 793F truck. The new truck offers a larger...
Read the case study "Southwest Airlines," found in Part 2 of your textbook. Review the "Guide to Case Analysis" found on pp. CA1 - CA11 of your textbook. (This guide follows the last case in the...
The Horizon Company will invest $60,000 in a temporary project that will generate the following cash inflows for the next three years. Year Cash Flow 1 ............ $15,000 2 ............ 25,000 3...
In Problems 65-72, summarize all pertinent information obtained by applying the graphing strategy, and sketch the graph of y=f(x). 66. 68. 70. 72. x2x6 f(x) 2x 1x +14 f(x)-_-x2-4 x3-5x2-6x 3x +2...
Complete these equilibrium reaction sin the most reasonable manner possible using the curved arrow convention to show the movement of electrons in the reactions, Predict whether the reactants or the...
Rocky's Chicken Huts, Inc. is a growing, publicly owned chain of fast food outlets. Patrick McBride, president of the chain, has decided that the company is large enough to establish an internal...
Which account does a merchandiser use that a service company does not use? a. Cost of goods sold b. Inventory C. Sales revenue d. All of the above
You are considering investing in a company that cultivates abalone for sale to local restaurants. Use the following information: Sales price per abalone ............. = $ 35 Variable costs per...
16. Tesla share price was 549.49 on Mar 25, 2020. The quote for the call option with 550 strike expiring on Apr 24, 2020 75.1/82.6. Assume 1 month risk-free rate at 0.9249 %. Please calculate the...
f(x) = 2x + 3 and g(x) = -3x + 2. For the above function, use base point x0 = 1.0 and x = 0.1 to compute f and g. Find (fg) (the change in the product) by computing f(x0 + x)g(x0 + x) - f(x0)g(x0)....
You have combined two stocks, ABC and DEF, into an equally weighted portfolio (Stable) and it has a variance of 35%. The covariance between ABC and DEF is 25%. ABC is a resource stock and has a...
Larry Sorich, as part of his estate planning, assigned his $100,000 group-term life insurance policy to his niece. Larry's employer provided for only $50,000 of coverage; therefore, the niece paid...
If you grabbed a Burger King for lunch, did some shopping at Neiman Marcus, munched at Outback Steakhouse for dinner, enjoyed a Budweiser, checked into a Hilton hotel, took a ride on an elevator made...
Review your answers to the first question in the previous section, Reflecting on Your Communication and Character Development. With a classmate, share as much as youre comfortable revealing. Find as...
Malaika plc, a British company, is planning to make a payment in euros of 150 million at the end of September. However, the nearest maturity date for a euro futures contract is at 13 December and it...
State whether each of the following situations is a simultaneous or sequential game. Explain your answer. a. A congressional vote by roll call. b. The ultimatum game. c. The Civil War. d. The...
Perks of Preferred Stock Kwame's grandmother recently gave him 25 shares of preferred stock. Kwame would like to figure out the actual dollar amount of the dividend, which is a percentage of the par...
A horizontal annulus with inside and outside diameters of 8 and 10 cm, respectively, contains liquid water. The inside and outside surfaces are maintained at 40 and 20oC, respectively. Calculate the...
Nova Electrics anticipated cash flow from operating activities of $6 million in 2011. It will need to spend $1.2 million on capital investments in order to remain competitive within the industry....
What effect would inflation have on a companys cost of capital? (Hint: Think about how inflation influences interest rates, stock prices, corporate profits, and growth.)
Given the following information, calculate the weighted average cost of capital for Hamilton Corp. Line up the calculations in the order shown in Table. Percent of capital structure: Debt...
The rotor shown in Fig. 9.44 (a) is balanced temporarily in a balancing machine by adding the masses $m_{1}=m_{2}=90 \mathrm{~g}$ in the plane $A$ and $m_{3}=m_{4}=90 \mathrm{~g}$ in the plane...
A turbine rotor is run at the natural frequency of the system. A stroboscope indicates that the maximum displacement of the rotor occurs at an angle $229^{\circ}$ in the direction of rotation. At...
The cylinders of a four-cylinder in-line engine are placed at intervals of $300 \mathrm{~mm}$ in the axial direction. The cranks have the same length, $100 \mathrm{~mm}$, and their angular...

A company considers a project that will generate cash sales of P50,000 per year. Fixed costs will

Question:

Expert Answer:

To calculate the expected annual cash flow resulting from the project we ... View the full answer

Foundations of Financial Management

Students also viewed these accounting questions