8) The minimum required rate of return for a project is the:

A.annual rate of return.

B.accounting rate of return.

C.cost of capital.

D. internal rate of return.

13. The formula for budgeted direct materials purchases is:

A. Budgeted production units + Ending direct materials inventory - Beginning direct materials inventory

B. Budgeted production units + Beginning direct materials inventory - Ending direct materials inventory

C. Materials needed for production + Ending direct materials inventory - Beginning direct materials inventory

D. Materials needed for production + Beginning direct materials inventory - Ending direct materials inventory

3. Hiawatha Corp is considering the purchase of a new piece of equipment. The

cost savings from the equipment would result in an annual increase in cash

flow of $200,000. The equipment will have an initial cost of $900,000 and have a

6 year life. There is no salvage value for the equipment. If the cost of capital is 7%, what is the approximate net present value? Ignore income taxes.

A.$53,300

B.$24,580

C.$900,000

D.$300,000