Whispering Winds Company is performing a post-audit of a project completed one year ago. The initial estimates were that the project would cost $575,000, would have a useful life of 9 years, zero salvage value, and would result in net annual cash flows of $107,000 per year. Now that the investment has been in operation for 1 year, revised figures indicate that it actually cost $625,000, will have a useful life of 11 years, and will produce net annual cash flows of $94,000 per year. Evaluate the success of the project. The company’s discount rate is 10%. (Use the above table.) (Round factor values to 5 decimal places, e.g. 1.25124 and final answers to 0 decimal places, e.g. 5,275.) Original estimate Revised estimate Net present value $enter a dollar amount rounded to 0 decimal places $enter a dollar amount rounded to 0 decimal places The original project was select an option . <>(n)PeriodsW NWP Assessment Builder Ul ApplicationTABLE 3 Present Value of 112234536799981011121314151617181920234 in25HOA V674%.96154.92456.88900.85480 .82270.82193 .78353TABLE 4 Present Value of an Annuity of 1(n)Payments1Apple | Chegg.com Yahoo Bing Google WikipediaW NWP Assessment Player Ul Application.79031.75992.73069.70259.67556education.wiley.com6%4%5%.96154 .95238 .943401.88609 1.85941 1.833392.77509 2.72325 2.673013.62990 3.54595 3.465114.45182 4.32948 4.212365.24214 5.07569 4.917326.00205 5.78637 5.58238Facebook Twitter LinkedIn The Weather Channel6%7%8%9%5%.95238 .94340 0.93458.90703.86384 .83962 0.81630.79209 0.76290.74726 0.71299 .68058.70496 0.66634 .63017.66506 0.62275 .58349.92593 .91743.89000 0.87344 .85734 .84168.79383 .77218.73503 .70843.64993.59627.54703.74622.71068.67684.64461.59190 0.54393.55839 0.50835.64958.62741 0.58201 .54027 .50187.50025 .46043.61391.46319 .42241.58468 .52679 0.47509 .42888 .38753.62460 .55684 .49697 0.44401 .39711 .35554.60057 .53032 .46884 0.41496 .36770 .32618.50507 .44230 0.38782 .34046.55526 .48102 .41727 0.36245 .31524.53391 .45811 .39365 0.33873 .29189.51337 .43630 .37136 0.31657 .27027.19785.49363 .41552 .35034 0.29586 .25025 .21199 .17986.47464 .39573 .33051 0.27615 .23171 .19449 .16351.45639 .37689 .31180 0.25842 .21455 .17843 .14864.57748.29925.27454.25187.21763.23107W Question 13 (Read Only)10%.90909.82645.75132 .73119.68301 .65873.62092 .59345.56447 .53464.51316.48166.46651.43393.42410.39092.38554.35218.35049.31863.28966.26333.239397%8%9%10%0.93458 .92593 .91743 .909091.80802 1.78326 1.75911 1.735542.62432 2.57710 2.53130 2.486853.38721 3.31213 3.23972 3.169864.10020 3.99271 3.88965 3.790794.76654 4.62288 4.48592 4.355265.38929 5.20637 5.03295 4.86842C Brady Corp. is considering the purchas...11%12%15%.90090 .89286 .86957.81162 .79719 .75614.65752.71178.63552.57175.56743.49718Yelp TripAdvisor iLiv.fit Google Yahoo.50663.45235.40388.36061.32197.31728 .28748.28584 .25668.25751 .22917.23199.20462.20900 .18270.43233.37594.32690.28426.24719.21494.18691.16253.14133.12289.18829 .16312.10687.16963 .14564.09293.15282 .13004 .08081.13768 .11611 .07027.12403 .10367 .0611011%12%15%.90090 .89286 .869571.71252 1.69005 1.625712.44371 2.40183 2.283233.10245 3.03735 2.854983.69590 3.60478 3.352164.23054 4.11141 3.784484.71220 4.56376 4.16042✩ + 88b Success Confirmation of Question Sub... <>W NWP Assessment Builder UI Application194/46420.45639234N5678910TABLE 4 Present Value of an Annuity of 1(n)Payments 4%11112131415HOA V1617181920.39575.37689AppleNet present valueeducation.wiley.com| Chegg.com Yahoo Bing Google Wikipedia Facebook Twitter LinkedIn The Weather Channel Yelp TripAdvisor iLiv.fit GoogleW NWP Assessment Player Ul Application.33051 0.27615.31180 0.25842.23171.2145519449.17843Original estimate5%6%7%8%12%15%.96154.95238.89286 .86957.943401.833391.88609 1.859412.77509 2.723252.673019%10%11%0.93458 .92593 .91743 .90909 .900901.80802 1.78326 1.75911 1.73554 1.71252 1.69005 1.625712.62432 2.57710 2.53130 2.48685 2.44371 2.40183 2.283233.62990 3.54595 3.46511 3.38721 3.31213 3.23972 3.16986 3.10245 3.03735 2.854984.45182 4.32948 4.21236 4.10020 3.99271 3.88965 3.79079 3.69590 3.60478 3.352165.24214 5.07569 4.91732 4.76654 4.62288 4.48592 4.35526 4.23054 4.11141 3.784486.00205 5.78637 5.58238 5.38929 5.20637 5.03295 4.86842 4.71220 4.56376 4.160426.73274 6.46321 6.20979 5.97130 5.74664 5.53482 5.33493 5.14612 4.96764 4.487327.43533 7.10782 6.80169 6.51523 6.24689 5.99525 5.75902 5.53705 5.32825 4.771588.11090 7.72173 7.36009 7.02358 6.71008 6.41766 6.14457 5.88923 5.65022 5.018778.76048 8.30641 7.88687 7.49867 7.13896 6.80519 6.49506 6.20652 5.93770 5.233719.38507 8.86325 8.38384 7.94269 7.53608 7.16073 6.81369 6.49236 6.19437 5.420629.98565 9.39357 8.85268 8.35765 7.90378 7.48690 7.10336 6.74987 6.42355 5.5831510.56312 9.89864 9.29498 8.74547 8.24424 7.78615 7.36669 6.98187 6.62817 5.7244811.11839 10.37966 9.71225 9.10791 8.55948 8.06069 7.60608 7.19087 6.81086 5.8473711.65230 10.83777 10.10590 9.44665 8.85137 8.31256 7.82371 7.37916 6.97399 5.9542412.16567 11.27407 10.47726 9.76322 9.12164 8.54363 8.02155 7.54879 7.11963 6.0471612.65930 11.68959 10.82760 10.05909 9.37189 8.75563 8.20141 7.70162 7.24967 6.1279713.13394 12.08532 11.15812 10.33560 9.60360 8.95012 8.36492 7.83929 7.36578 6.1982313.59033 12.46221 11.46992 10.59401 9.81815 9.12855 8.51356 7.96333 7.46944 6.25933LAW Question 13 (Read Only).16351 .13768.14864 .12403C Brady Corp. is considering the purchas....07027.06110Revised estimate.11611.10367Evaluate the success of the project. The company's discount rate is 10%. (Use the above table.) (Round factor values to 5 decimal places, e.g. 1.25124 and final answers to O decimalplaces, e.g. 5,275.)Yahoo✩ + 88b Success Confirmation of Question Sub...

The current value of a stream of payments from the project, investments, etc. is determined by using…

Whispering Winds Company is performing a post-audit of a project completed one year ago. The initial estimates were that the project would cost $575,000, would have a useful life of 9 years, zero salvage value, and would result in net annual cash flows of $107,000 per year. Now that the investment has been in operation for 1 year, revised figures indicate that it actually cost $625,000, will have a useful life of 11 years, and will produce net annual cash flows of $94,000 per year. Evaluate the success of the project. The company’s discount rate is 10%. (Use the above table.) (Round factor values to 5 decimal places, e.g. 1.25124 and final answers to 0 decimal places, e.g. 5,275.) Original estimate Revised estimate Net present value $enter a dollar amount rounded to 0 decimal places $enter a dollar amount rounded to 0 decimal places The original project was select an option .

Whispering Winds Company is performing a post-audit of a project completed one year ago. The initial estimates were that the project would cost $575,000, would have a useful life of 9 years, zero salvage value, and would result in net annual cash flows of $107,000 per year. Now that the investment has been in operation for 1 year, revised figures indicate that it actually cost $625,000, will have a useful life of 11 years, and will produce net annual cash flows of $94,000 per year. Evaluate the success of the project. The company’s discount rate is 10%. (Use the above table.) (Round factor values to 5 decimal places, e.g. 1.25124 and final answers to 0 decimal places, e.g. 5,275.) Original estimate Revised estimate Net present value $enter a dollar amount rounded to 0 decimal places $enter a dollar amount rounded to 0 decimal places The original project was select an option .

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter4: Time Value Of Money

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

OA/D1 | Financial Accounting and Reporting| Fi Briefly explain the difference between Present value Annuity Due and Deferred Annuity [ explanation is required not the equation] vered of 2.00 stion A B I- 1.
Use the NPV method to determine whether Root Products should invest in the following projects: • Project A: Costs $275,000 and offers eight annual net cash inflows of $53,000. Root Products requires an annual return of 12% on investments of this nature. Project B: Costs $380,000 and offers 9 annual net cash inflows of $74,000. Root Products demands an annual return of 10% on investments of this nature. E(Click the icon to view Present Value of $1 table.) E (Click the icon to view Present Value of Ordinary Annuity of $1 table.) Read the requirements. Requirement 1. What is the NPV of each project? Assume neither project has a residual value. Round to two decimal places. (Enter any factor amounts to three decimal places, X.XXX. Use parentheses or a minus sign for a negative net present value.) Caclulate the NPV (net present value) of each project. Begin by calculating the NPV of Project A. Project A: Net Cash Annuity PV Factor Present Years Inflow (i=12%, n=8) Value 1-8 Present value of…
Carter Company is considering a project with an initial investment of $600,500 that is expected to produce cash inflows of $131,000 for ten years. Carter's required rate of return is 16%. E (Click on the icon to view Present Value of $1 table.) (Click on the icon to view Present Value of Ordinary Annuity of $1 table.) 14. What is the NPV of the project? 15. What is the IRR of the project? Is this an acceptable project for Carter? 16. 14. What is the NPV of the project? (Enter the factor amount to three decimal places, X.XXX. Round the present value of the annuity to the nearest whole dollar. Use parentheses or a minus sign for a negative net present value.) Annuity PV Factor (i=16%, n=10) Net Cash Present Years Inflow Value 1- 10 Present value of annuity Investment Net present value
The tree diagram in figure below describes the uncertain cash flows for an engineering project. The analysis period is two years, and MARR = 15% per year. Based on this information, a. What are the E(PW), V(PW), and SD(PW) of the project? b. What is the probability that PW ≥ 0? Click the icon to view the tree diagram. Click the icon to view the interest and annuity table for discrete compounding when the MARR is 15% per year. a. Calculate the E(PW), V(PW), and SD(PW) of the project. (Round to the nearest dollar.) E(PW) = $ V(PW) = SD(PW) = $ million ($)2 (Round to two decimal places.) b. The probability that PW 20 is (Round to the nearest dollar.) (Round to two decimal places.)
s/d/e/1FAlpQLSfgr9AkfTTNtEDdijdlH8qi7BUKNWLBInw/rS 4ywgwjmAsw/formRespons O ) $3,802 d) $852. e) None of the above: 5. What is the future value of a b year ordinary annuity with annual payments of $200, evaluated at a 15 per O a) $ 670 44 O Di S 842.91 O as1.522 64 G) S1.348 48 6. What is the present value of a7-vearordjnaryennu payments of $300. evaluated at a 10 percentinterestrate? O a S 670 43
Appendix D Present value of an annuity of $1, PVA Period -NM in D 1 2 3 4 5 6 7 8 9 12 13 15 16 18 19 20 25 30 40 50 PUINDING FAMIGOs 19 0.990 1.970 2.941 3.902 4.853 5.795 6.728 7.652 8.566 9.471 10.368 11.255 12.134 13.004 13.865 14.718 15.562 16.398 17.226 18.046 22.023 25.808 32.835 39.196 2% 0.980 1.942 2.884 3.808 4.713 5.601 6.472 7.325 8.162 8.983 9.787 10.575 11.348 12.106 12.849 13.578 14.292 14.992 15.678 16.351 19.523 22.396 27.355 31.424 3% 0.971 1.913 2.829 3.717 4.580 5.417 6.230 7.020 7.786 8.530 9.253 9.954 10.635 11.296 11.938 12.561 13.166 13.754 14.324 14.877 17.413 19.600 23.115 25.730 PVA-A 1 4% 0.962 1.886 2.775 3.630 4.452 5.242 6.002 6.79.3 8.111 8.760 9.385 9.986 10.563 11.118 11.652 12.166 12.659 13.134 13.590 15.622 17.292 19.793 21.482 1 (1 + )" 5% 0.952 1.859 2.723 3.546 4.329 5.076 5.786 6.463 7.108 7.722 8.306 8.863 9.394 9.899 10.380 10.838 11.274 11.690 12.085 12.462 14.094 15.372 17.159 18.256 Percent 0.943 1.833 2673 3.465 4.212 4.917 5.582 6.210…
TABLE 9C.2 Present Value of Annuity of $1, p = [1-1/(1+]/i 3.25% 3.5% 1 2 3 4 5 6 7 6.5982 6.5346 8 7.4859 7.4051 7.4051 7.3255 7.2472 9 8.3605 8.2605 8.1622 8.0657 9.2222 9.1012 8.9826 8.8662 10 11 12 13 14 15 Periods 1.5% 1.75% 2% 2.25% 2.5% 2.75% 3% 0.9852 0.9828 0.9804 0.9780 0.9756 0.9732 0.9709 0.9685 0.9662 1.9559 1.9487 1.9416 1.9345 1.9274 1.9204 1.9135 1.9066 1.8997 2.9122 2.8980 2.8839 2.8699 2.8560 2.8423 2.8286 2.8151 2.8016 3.8544 3.8309 3.8077 3.7847 3.7620 3.7394 3.7171 3.6950 3.6731 4.7826 4.7479 4.7135 4.6795 4.6458 4.6126 4.5797 4.5472 4.5151 5.6972 5.6490 5.6014 5.5545 5.5081 5.4624 5.4172 5.3726 5.3286 6.4720 6.4102 6.3494 6.2894 6.2303 6.1720 6.1145 7.1701 7.0943 7.0197 6.9462 6.8740 7.9709 7.8777 7.7861 7.6961 7.6077 8.7521 8.6401 8.5302 8.4224 8.3166 10.0711 9.9275 9.7868 9.6491 9.5142 9.3821 9.2526 9.1258 9.0016 10.9075 10.7395 10.5753 10.4148 10.2578 10.1042 9.9540 9.8071 9.6633 11.7315 11.5376 11.3484 11.1636 10.9832 10.8070 10.6350 10.4669 10.3027 12.5434…
Use the table below to answer the following questions: Present Value of 1 Factor Present Value of an Annuity of 1 Factor Period 1/2 Yr Full-Yr 1/2 Yr Full-Yr 1 0.9578 0.9174 0.9578 0.9174 2 0.9174 0.8417 1.8753 1.7591 3 0.8787 0.7722 2.7540 2.5313 4 0.8417 0.7084 3.5957 3.2397 5 0.8062 0.6499 4.4019 3.8897 6 0.7722 0.5963 5.1740 4.4859 Assumption: Required annual effective rate (EPR) of return is 9%. If an investment pays you $54,000 every 6 months for 3 years, starting at the beginning of each 6 month period, what is its present value? Group of answer choices $279,396 $291,703 $250,193 $273,380
Use the table below to answer the following questions: Present Value of 1 Factor Present Value of an Annuity of 1 Factor Period 1/2 Yr Full-Yr 1/2 Yr Full-Yr 1 0.9578 0.9174 0.9578 0.9174 2 0.9174 0.8417 1.8753 1.7591 3 0.8787 0.7722 2.7540 2.5313 4 0.8417 0.7084 3.5957 3.2397 5 0.8062 0.6499 4.4019 3.8897 6 0.7722 0.5963 5.1740 4.4859 Assumption: Required annual effective rate (EPR) of return is 9%. If an investment pays you $324,000 at the end of 3 years, what is its present value? Group of answer choices $279,396 $291,703 $273,380 $250,193
Use the table below to answer the following questions: Present Value of 1 Factor Present Value of an Annuity of 1 Factor Period 1/2 Yr Full-Yr 1/2 Yr Full-Yr 1 0.9578 0.9174 0.9578 0.9174 2 0.9174 0.8417 1.8753 1.7591 3 0.8787 0.7722 2.7540 2.5313 4 0.8417 0.7084 3.5957 3.2397 5 0.8062 0.6499 4.4019 3.8897 6 0.7722 0.5963 5.1740 4.4859 Assumption: Required annual effective rate (EPR) of return is 9%. If an investment pays you $54,000 every 6 months for 3 years, what is its present value? $279,396 $250,193 $273,380 $291,703
Use the table below to answer the following questions: Present Value of 1 Factor Present Value of an Annuity of 1 Factor Period 1/2 Yr Full-Yr 1/2 Yr Full-Yr 1 0.9578 0.9174 0.9578 0.9174 2 0.9174 0.8417 1.8753 1.7591 3 0.8787 0.7722 2.7540 2.5313 4 0.8417 0.7084 3.5957 3.2397 5 0.8062 0.6499 4.4019 3.8897 6 0.7722 0.5963 5.1740 4.4859 Assumption: Required annual effective rate (EPR) of return is 9%. If an investment pays you $108,000 at the end of each year for 3 years, what is its present value? Group of answer choices $291,703 $273,380 $279,396 $250,193
P5-20 Present value of an annuity Consider the following cases. 101 gardens, annom olgnie to anoeinsamos oulny omil wolls lliw vasqmos mwon-llow .ae ei 1200 yiu Case A B invoma algnie C D E assy 05 to bas 10 000,0312 00,Esethtow Vo(2) An annuity due. 000, ES2 ale od to no sola Annuity paymentzoll Interest rate or Annuity length (years) £30,000 8% 3 24,000 15 8,000 20 160,000 8 72,000 10 12 a. Calculate the present value of the annuity, assuming that it is (1) An ordinary annuity. Ysbouley b. Compare your findings in parts a(1) and a(2). All else being identical, which type of annuity is preferable-ordinary or annuity due? Explain why. 12 5 9

SEE MORE QUESTIONS

Recommended textbooks for you

Corporate Fin Focused Approach

Finance

ISBN:

9781285660516

Author:

EHRHARDT

Publisher:

Cengage

Corporate Fin Focused Approach

Finance

ISBN:

9781285660516

Author:

EHRHARDT

Publisher:

Cengage

SEE MORE TEXTBOOKS

GET THE APP

About FAQ Academic Integrity Sitemap Document Sitemap

Contact Bartleby Contact Research (Essays)High School Textbooks Literature Guides Concept Explainers by Subject Essay Help Mobile App

GET THE APP

Privacy

Your CA Privacy Rights

Your NV Privacy Rights

About Ads

Manage My Data

bartleby, a Learneo, Inc. business

		Original estimate		Revised estimate
Net present value		$enter a dollar amount rounded to 0 decimal places		$enter a dollar amount rounded to 0 decimal places