ABC Ltd is considering an investment project that directors believe is viable and will be beneficial to the family in future. The project has useful life of 50 years with the following cashflow pattern Year Cashflow
1-4 200,000 p.a
5-30 95,000 p.a

31-40 60,000 p.a

a)Assuming that the project will complete its entire useful life
Required:
Calculate the present value of the project cashflow (8 marks)
b) Bonus issue is one of the method of paying dividends. Explain any four advantages of
this method of paying dividends (8 marks)
c) Explain any four functions of financial management (4 marks)
d) Highlight four factors that affect the capital structure of a firm (4 marks)

Answer rating: 100% (QA)

The detailed answer for the above question is provided below a To calculate the present value of the project cashflow we can use the present value formula which is PV CF 1 rn Where PV present value CF ... View the full answer