Question: The following net present value (NPV) is presented to you. Assume all calculations were done correctly. T Year 0 Year 1 Year 2 Year

The following net present value (NPV) is presented to you. Assume all

The following net present value (NPV) is presented to you. Assume all calculations were done correctly. T Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Cost (20 500 000) Working capital (1670 000) 1670 000 Operational costs Sales income (22 170 000) (1.300 000) (300 000) 5796 000 6143 760 4496 000 4843 760 11 300 000) 6512 396 5212 305 (1 300 000) (1 300 000) 6903 129 7317316 5603 129 7 694 439 The weighted average cost of capital of the company is 7%. The curent JBAT rate is 10% and cost of equity will be 9%. The company tax rate is 28% What is the discounted factor that will be used in me calculation of the NPV?

Step by Step Solution

★★★★★

3.47 Rating (160 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

Given information Weighted Average Cost of Capital WACC 7 JIBAR rate 10 Cost of equity 9 Company tax ... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Document Format (2 attachments)

6643106e4d451_952624.pdf

180 KBs PDF File

6643106e4d451_952624.docx

120 KBs Word File

Students Have Also Explored These Related Accounting Questions!

A B D F Dayton, Inc. Annual Income Statement (Values in Millions) Common Size 2012 2011 2012 2011 Sales $ 178,909 $ 187,510 Cost of Sales 111.631 Gross Operating Profit Selling, General & Admin....

Your event lighting company is thinking about investing in a bank of portable lights for sporting events. Your accounting department just brought you the following pro-forma accounting projections...

What is the spring cloud API Gateway and how do you set it up to make a call to the product service via eureka service discovery server? Give me the complete code in detailed steps.

Design a controller to stabilize the system G(S) = with feedback H(S) +371

ADVANCED FINANCIAL DECISION MAKING THERE IS ONLY ONE QUESTION HERE TO SOLVE HERE PLEASE Case Study 3 Hazel Tree Hotels (HTH) is a Scottish company that operates tourist hotels throughout the UK and...

5. Growth options Companies often come across projects that have positive NPV opportunities in which the company does not invest. Companies must evaluate the value of the option to invest in a new...

for question 4 i uploaded 2 times extra so please igrone and help me do quetion 2,3,4,5. thank you Question 2 The following table lists the sale and purchase records of an inventory item, i.e....

ADVANCED FINANCIAL DECISION MAKING...

5. Growth options Companies often come across projects that have positive NPV opportunities in which the company does not invest. Companies must evaluate the value of the option to invest in a new...

please answer the attached questions. thanks I have attached the questions for answering A company has paid $2 per share in dividends for the past several years and plans to continue to do so...

The case tells the story of Ann Stewart, President and primary owner of Cape Chemical. By most measures, the performance of Cape Chemical has been very good over the last three years. Double-digit...

The following information has been made available to you to assist in the preparation of the financial statements of Ant Ltd for the year ended 30 June 2018: 1. The company has been involved in a...

A school wishes to form three sides of a rectangular playground using 240 meters of fencing. The playground borders the school building, so the fourth side does not need fencing. As shown below, one...

Prove t a n - 1 x + t a n - 1 y = t a n - 1 ( x + y 1 - x y ) where - 2 .

In 2011, Rouse & Sons, a small environmental-testing firm, performed 12,200 radon tests for $290 each and 16,400 lead tests for $240 each. Because newer homes are being built with lead-free pipes,...

Choosing cost drivers, activity-based costing, activity-based management. Annie Warbucks runs a dance studio with childcare and adult fitness classes. Annie's budget for the upcoming year is as...

At a time when demand for ready-to-eat cereal was stagnant, a spokesperson for the cereal maker Kelloggs was quoted as saying, . . . for the past several years, our individual company growth has...

While there is a degree of differentiation among general merchandise retailers like Target and Kmart, weekly newspaper circulars announcing sales provide evidence that these firms engage in price...

The Ewert Exploration Company is considering two mutually exclusive plans for extracting oil on property for which it has mineral rights. Both plans call for the expenditure of $10 million to drill...

6 Theory of Machines 5. A shaft carries five masses A, B, C, D and E which revolve at the same radius in planes which are equidistant from one another. The magnitude of the masses in planes A, C and...

Calculate appropriate summary statistics (e. g., the median, mean, standard deviation, and range) for each of the four groups. For the female mice, calculate the difference between the treatment and...

Consider the college graduation data introduced in Section 9.7. a. Create a plot and compare the survival experiences to investigate whether there are differences in the time required to obtain a...

Fit a Poisson regression model to the total species count with covariates log(area) and log (elevation). Confirm the results of the LRT discussed above to determine if at least one of the two...

Operations strategy has content and process. The content concerns the specific decisions that are taken to achieve specific objectives. The process is the procedure that is used within a business to...

Strategy is the total pattern of decisions and actions that position the organization in its environment and that are intended to achieve its long-term goals. Plo8

How are the four perspectives of operations strategy reconciled? Plo8