MULTIPLE CHOICE:

$34.$The initial investment for a project should be developed...$$

A$.$by only some components of free cash flow, such as the need of long$-$term operating assets and the need for net working capital, but not operating income or tax.$$

B$.$considering only the capitalized cost of equipment required to launch the project.

C$.$by the components of free cash flow such as operating income, tax, the need of long$-$term operating assets and the need for net working capital.$$

D$.$considering only the need for current assets and long$-$term assets.

$37.$What does a negative free cash flow represent?

A$.$The business has a negative operating cash flow $($OCF$)$

B$.$The business is generating more cash than it is consuming

C$.$The business is consuming more cash than it is generating

D$.$The business has a negative operating income $($aka$,$ an operating loss$)$

TRUE OR FALSE ALL FOLLOWING QUESTIONS:

$39.$The capitalized costs of fixed assets acquired at the beginning of a project drive the annual depreciation for the years which follow.The capitalized costs of fixed assets acquired at the beginning of a project drive the annual depreciation for the years which follow.

PROBLEMS:

$1.$A company wishes to improve efficiency and have $24$ days in inventory. If COGS is forecasted as $$19,872,$ what is the targeted inventory amount?

$4.$A company makes $$26,875$ in purchases annually and has accounts payable of $$2,212.$ If they wanted to take $80$ days to pay, what would be their new accounts payable level?

$5.$If a business has inventory of $$1,727$ and COGS of $$21,031,$ what is the Days in Inventory?

$6.$ A company has accounts receivable of $$3,859$ and sold $$30,825$ on account. What was their average collection period?

$7.$A company has accounts receivable of $$2,907$ and sold $$37,673$ on account. They want to improve their collection time to $28$ days. Assuming sales remain the same, what is the budgeted target for accounts receivable?

$9.$A company makes $$19,107$ in purchases annually and has accounts payable of $$2,216.$ How long on average does the company take to pay its vendors?

$10.$If a business has inventory of $$2,755$ and COGS of $$18,817,$ what is the inventory turnover rate?

$11.$A company is acquiring an asset which will have a capitalized cost of $$1,711,870$ and a depreciable life of $8$ years. They plan to use this machine for $5$ years, then sell it for $$361,618.$ Assuming a $27\%$ tax rate, straightline depreciation and a $$99,060$ salvage value, what will be the tax effect of the gain or $($loss$)$ when they sell it$?$

$12.$A company is acquiring an asset which will have a capitalized cost of $$1,231,051$ and a depreciable life of $7$ years. Assuming straightline depreciation and a $$144,014$ salvage value, what will be the annual depreciation expense?