nd a minimum required rate of return of 10%. the current average age of receivables is 70 days but with the loan collectors, it is forecasted to decrease to 30 days. How much is the net benefit or cost of this option?
Q: Altmax Ltd, a company that manufactures automobile wiring harnesses, has budgeted P = $400,000 now…
A: Time value of money means that worth of a rupee today is less than the worth of rupee in future.…
Q: Camber Corporation has to decide if they can finance purchasing 10 new machines for all their…
A: 1.The actual cost of each machine is $1,730,000 and total cost to be required to purchase 10…
Q: Best Trim, a manufacturer of lawn mowers, predicts that it will purchase 204,000 spark plugs next…
A: Relevant cost: Relevant cost is the avoidable cost which incurred at the time of the decision making…
Q: Best Trim, a manufacturer of lawn mowers, predicts that it will purchase 204,000 spark plugs next…
A:
Q: BRCC is evaluating an option for funding its working capital during the next year. The company plans…
A: in this we have to calculate the interest and add to that to get required value.
Q: Firm ZLC will be receiving payments of $10,000 per month for consulting services, with first payment…
A: Future value of annuity The future value of annuity refers to the total value of the investment at…
Q: Lamar Lumber buys $8 million of materials (net of discounts) on terms of 3/5, net 60; and it…
A: Additional credit can be calculated by using this equation Additional credit =Cost of…
Q: The ZLC consulting firm just signed an agreement to provide services to another firm. In doing so,…
A: Here, To Find: Total Present Value of agreement =?
Q: A company is considering buying workstation computers to support its engineering staff. In today's…
A: Given: i = 16%, f = 10% To Find the amount of payment, first we have to calculate i: i = i - f…
Q: You have $35,009.41 in a brokerage account, and you plan to deposit an additional $5,000 at the end…
A: According to the time value rule, dollar money available today is worth more than the same dollar…
Q: Deep Excavating Inc. is purchasing a bulldozer. The equipment has a price of $106,000. The…
A: Here, Cost of equipment = $ 106,000 Number of equal annual payment = 10 Equal annual payment = $…
Q: what is the maximum amount that the company should pay for the machine today such that the chouices…
A: Loan amortization refers to a schedule which is prepared to shows the periodic loan payments, amount…
Q: A store manager plans to exchange his old computer at the end of four years for a newer one worth…
A: The future value of the annuity is the total value of all the payments which is occurred regularly…
Q: How much will Kingston Technologies have to pay each year in 8 equal payments, starting 2 years from…
A: Since you have asked multiple questions, we will solve the first question for you. If you want any…
Q: Franklin Mints, a confectioner, is considering purchasing a new jelly bean-making machine at a cost…
A: IRR is the rate at which NPV of the project is zero.
Q: How many years will it take to reach your goal?
A: Year Opening Balance ($) Interest % Interest Amount ($) Additional Deposit ($) Balance at year end…
Q: Best Trim, a manufacturer of lawn mowers, predicts that it will purchase 204,000 spark plugs next…
A: Opportunity Cost: Opportunity cost means the potential income and other benefits that are lost due…
Q: Choam Inc. owes $16,100 that is due in 1 year. Instead of paying then, Choam is going to make two…
A: Amount due in 1 year = $16100 Interest rate (r) = 3.8% per annum First payment is to be done in 6…
Q: Johnson Hardware wants to construct a new building at a second location. If construction could begin…
A: Since you have posted a question with multiple sub-parts, we will solve first three subparts for…
Q: stomer wishes to have an amount of R300 000 at the end of 10 years. The bank pays an interest rate…
A: The given problem can be solved using PV function in excel. PV function computes present worth for…
Q: Anderson Manufacturing Co., a small fabricatorof plastics, needs to purchase an extrusion…
A: First annual payment is determined using the following formula: Principal=Annual Payment of year…
Q: You plan to make a lump-sum deposit of $5000 now into an investment account that pays 6% per year,…
A: Lump Sum Deposit = 5000 Return % = 6% Annual End of year withdrawals = 1000 Time Period of…
Q: How many years will it take Rexchem, Inc., to accumulate $375,000 for a chemical feeder, if the…
A:
Q: A business sets up a sinking fund so they will have a $46,000.00 to pay for a replacement piece of…
A: A Sinking fund refers to a fund that is kept aside or borrowed for the purpose of paying off a debt…
Q: A growing company plans to borrow IDR 1,000,000,000 for 5 years from a bank. Bank Sweet is willing…
A: Repayment fund is the amount set aside to pay a sum of money over a period of time. This fund is…
Q: enkins Security has learned that a rival has offered to supply a parking garage with security for…
A: Time has been precious in all perspectives, however in terms of finance, time has a monetary value.…
Q: You’ve just joined the investment banking firm of Dewey, Cheatum, and Howe. They’ve offered you two…
A: The current worth of the cash flows or an asset after discounting is termed as the present value.
Q: Aunt Tillie has deposited $33,000 today in an account which will earn 10 percent annually. She plans…
A: Hey, since there are multiple questions posted, we will answer the first question. If you want any…
Q: What is the monthly payment? 2) How much of the first payment goes toward interest? 3) How much of…
A: As per company policy, it is only possible to solve the first 3 sub parts of this question.
Q: Accusoft Systems is offering small business owners a software package that keeps track of many…
A:
Q: Your boss has asked you to evaluate the economic viability of refinancing a loan on your plant’s…
A: NPV is the net current worth of cash flows that are expected to occur in the future.
Q: Environmental recovery company RexChem Partners plans to finance a site reclamation project that…
A: Given: The company borrows $4.1 million The compounding period n is 4 years Interest is 15% per…
Q: Johnson Hardware wants to construct a new building at a second location. If construction could begin…
A: Inflation rate = 3% Cost of New Building = $500,000 Down Payment required = 20% Monthly Investment =…
Q: Camber Corporation has to decide if they can finance purchasing 10 new machines for all their…
A: a)Calculation of annual payments:Answer:The annual payment is $3,417,453.45.The actual cost of each…
Q: A company estimates that it will need $66,000 in 10 years to replace a computer. If it establishes a…
A: We need to use the following formula to calculate the amount for sinking fund CF=FVn(1+r)n -1r Where…
Q: How many years will it take Rexchem, Inc. to accumulate $400,000 for a chemical feeder if the…
A: The present value is the value of the sum received at time 0 or the current period. It is the value…
Q: You've just joined the investment banking firm of Dewey, Cheatum, and Howe. They've offered you two…
A: Given, Interest rate = 9% per annum compounded monthly = 0.75% per month Option 1 = 66000 each…
Q: A small business has determined that the machinery they currently use will wear out in 17 years. To…
A: The question is based on the concept of Financial Management.
Q: Kenworth Imaging got a $700,000 loan that came with a choice of two different repayment schedules.…
A: The computation is done below:
Q: French Fried Food Inc. wishes to accumulate P500,000 during the next 24 months to open a second…
A: The amount which are paid constantly without any change in amount or frequency is called Annuity and…
Q: A company receives 13.78% per year from accounts. They are considering a project that will force…
A: present value of annuity (PVA): PVA=A×1-11+RNRwhere,A=annuityR=interest rateN=number of years…
Q: Taggart Transcontinental currently has a bank loan outstanding that requires it to make three annual…
A: The question is based on the concept of time value of money .The bank has allowed the borrower to…
Q: Best Trim, a manufacturer of lawn mowers, predicts that it will purchase 204,000 spark plugs next…
A: Opportunity Cost: Opportunity cost is a total of potential income and other benefits that are lost…
Q: A pulp and paper company is planning to set aside $150,000 now for possibly replacing its large…
A: Future value = Present value * (1+ rate)^no. of years 8)
Q: Camber Corporation has to decide if they can finance purchasing 10 new machines for all their…
A: 1.The original cost per machine is $1,730,000 and the overall cost needed to buy 10 machines is as…
Q: Due to a cool spring season, Petra’s pool installation business has not had the sales she…
A: Credit amount (C) = $42800 - $5000 = $37800 n = 24 payments r = 4.8% per annum = 0.4% per month…
ABC would like to hire two loan collectors to speed up its collection process. Each of the loan collectors will be given total annual benefits of P150000 per year. The entity earns P30000000 in sales, 10% of which are cash. The entity has a 365-day per year and a minimum required
Step by step
Solved in 2 steps
- Sexy Inc. makes use of the lockbox system, what would be the net benefit to the company? Use 365 days in a year. Question MTR bank has agreed to provide a lockbox system to Sexy Inc. for a fixed fee of P50, 000 per year and a rate of P.50 for each payment processed by the bank. On average, Sexy Inc. receives 50 payments per day, each averaging P20,000. With the lockbox system, the company’s collection float will decrease by two days. The annual interest rate on money market securities is 6%. If Sexy Inc. makes use of the lockbox system, what would be the net benefit to the company? Use 365 days in a year. A. P50,000 B. P59,125 C. P60,875 D. P120,000Singapore Post has approached a bank to take out a mortgage loan purchase a new warehouse. The bank is willing to provide them with a 10-year loan of $400,000 at an interest rate of 12% per annum, compounding monthly. Singapore Post will be required to make monthly repayments on the loan. Calculate the monthly loan instalment that will be paid on the loan. Assume that Singapore Post instead negotiates to make annual repayments on the loan. What is the annual effective interest rate on the current loan terms? Singapore Airlines has 8% $100,000 debentures outstanding in the corporate bond market, with exactly 8 years left until maturity. The bonds pays coupon half yearly. Calculate the price of the corporate bond to yield an investor 6% per annum, compounding half yearly.French Fried Food Inc. wishes to accumulate P500,000 during the next 24 months to open a second location. What constant amount should it pay at the end of each month into a money market savings account with an investment dealer, to attain its saving objectives? The planning assumption is that the account will earn 10% compounded semi-annually. Find the present value of an annuity which pays P1,460 at the end of every 3 months of 6 years, if money is worth 9% compounded monthly? If P2,000 is invested at the end of every year at 8% compounded semi-annually, what will be the total value of the periodic investment after 20 years?
- Your company will generate GH¢ 55,000 in annual revenue each year for the next eight years from a new information database. The computer system needed to set up the database costs GH¢ 250,000. If you can borrow the money to buy the computer system at 7.5 percent annual interest, can you afford the new system? First National Bank charges 7.5 percent compounded quarterly on its business loans. First United Bank charges 7.5 percent compounded semi-annually. As a potential borrower, which bank would you go to for a new loan?Windsor Tool Inc. has a $500,000 loan for a new EDM machine to be used in the tool/die production. The interest rate for this loan is 6% compounded annually. The finance manager decides that the company will make $40,000 payment each year, starting the end of the first year. By calculation, it will take the company N years to pay back the loan. Notice that the payments for Year1 to Year(N-1) will be $40,000 as planned. The last payment at the end of Year-N will be smaller than $40,000. First, calculate the value for N=? (years) Second, calculate the last payment for Year(N)=? Notice that this is a Multi-Answer question, you have to pick one for the number of years and pick one for the last payment amount. N=22 Years N=24 Years N=26 Years N=28 Years Payment for last Year = $31,905. Payment for last Year = $16,794. Payment for last Year = $10,540. Payment for last Year = $36,555.The ZLC consulting firm just signed an agreement to provide services to another firm. In doing so, ZLC will receive $100,000 today, and then annual payments of $70,000 per year for 5 years, with first annual payment starting one year from today. What is the present value of this agreement if the appropriate discount rate is 8.50% compounded annually?
- How much will Kingston Technologies have to pay each year in 7 equal payments, starting 2 years from now, to repay a $900,000 loan. The interest rate is 14% per year? Kingston Technologies will have to pay $ each year to repay the loan.The Omega Venture Group needs to borrow to finance a project. Repayment of the loan involves payments of $2,740at the end of every six months for six years. No payments are to be made during the development period of nine years. Interest is 4% compounded monthly. (a) How much should the Group borrow? (b) What amount will be repaid? (c) How much of that amount will be interest?Complete the problems below. 1. A company will need $40,000 in four years for a new addition. To meet the goal, the company will deposit money into an account paying 6% annual interest, compounded monthly. How much should the company deposit each month in order to be able to pay for the addition? Looking at a couple of scenarios to compare to the initial investment (above): a. Exactly 20 months after the company begins their investment (above), they receive a payment from a settled lawsuit of $2000 that they immediately deposit into the account. If they continue, uninterrupted, with their monthly deposits, will the company be able to afford to add a skylight to the addition if the change order (the amount added to the original cost of $40,000) is $3000? If yes, how much, if any would be left over? If no, how much more money will they need? b. Suppose that instead of depositing the money monthly for five years, they decide to finance the addition (the original $40,000) for four years at…
- You plan to make a lump-sum deposit of $5000 now into an investment account that pays 6% per year, and you plan to withdraw an equal end-of-year amount of $1000 for 5 years, starting next year. At the end of the sixth year, you plan to close your account by withdrawing the re- maining money. Define the engineering economy symbols involved.Your business had to borrow 584, 069.18 to cover some urgent experises. The loan carries an annual interest rate of 15%, and the monthly payment is $2000. How many years will it take to pay off this loan? ROUND YOUR ANSWER TO THE NEAREST WHOLE NUMBERYour company borrows $500,000 from a bank to finance the purchase of a new machine. The nominal annual Interest rate Is 8%. The loan is to be fully amortized over 2 years, with equal payments made at the end of each 6-month perlod. 1. What will be the total amount of loan principal repald during the entire first year? 2. What will be the total amount of Interest pald during the entire second year? (Note: For each question, please show detalled explanations as to how you proceed to your answer along with detailed calculations).
