Can you explain how they calculate the value of NPV? 1.ProjectDevelopment time (hrs.)Initial investment1,250 hrs*$52 = $65,000400 hrs*$52 = $20,800Calendar/emailExpense reportTracking programSpreadsheet program1,250400750 hrs*$52 = $39,0002,500 hrs*$52 = $130,0001,875 hrs*$52 = $97,5006,250 hrs*$52 = $325,0007502,5001,8756,250Total time: 13,025 hrs.Web browserTrip plannerYearDiscountfactorProjectTrackingSpreadsheet program0.10WebCalendar/emailExpensereport0.05planner0.05browserprogram0.05-0.100.15-$65,000$750,000$675,000$607,500-$20,800$250,000$262,500$275,625-$39,000$500,000$525,000$551,250-$130,000$1,000,000$1,100,000$1,210,000-$97,500$2,500,000$2,875,000$3,306,250 | $1,433,250-$325,000$1,300,000$1,365,000110.89290.797230.7118NPV$1,575,155$607,862$1,218,324 | $2,501,025 | $6,779,899 | $2,944,043

The question is related to Capital Budgeting. The Net Present Value will be calculated with the help…

1. Project Development time (hrs.) Initial investment Calendar/email Expense report Tracking program Spreadsheet program 1,250 hrs*$52 = $65,000 400 hrs*$52 = $20,800 750 hrs*$52 = $39,000 2,500 hrs*$52 = $130,000 1,875 hrs*$52 = $97,500 6,250 hrs*$52 = $325,000 1,250 400 750 2,500 1,875 6,250 Total time: 13,025 hrs. Web browser Trip planner Discount factor Year Project Calendar/ email Expense герort 0.05 Tracking program 0.05 Spreadshee t program 0.10 Web browser T planner 0.05 -0.10 0.15 -$65,000 $750,000 $675,000 $607,500 -$20,800 $250,000 $262,500 $275,625 -$39,000 $500,000 $525,000 $551,250 -$130,000 $1,000,000 $1,100,000 $1,210,000 -$97,500 $2,500,000 $2,875,000 $3,306,250 -$325,000 $1,300,000 $1,365,000 $1,433,250 1 1 0.8929 3 0.7972 0.7118 NPV $1,575,155 $607,862 $1,218,324 $2,501,025 $6,779,899 | $2,944,043

1. Project Development time (hrs.) Initial investment Calendar/email Expense report Tracking program Spreadsheet program 1,250 hrs$52 = $65,000 400 hrs$52 = $20,800 750 hrs$52 = $39,000 2,500 hrs$52 = $130,000 1,875 hrs$52 = $97,500 6,250 hrs$52 = $325,000 1,250 400 750 2,500 1,875 6,250 Total time: 13,025 hrs. Web browser Trip planner Discount factor Year Project Calendar/ email Expense герort 0.05 Tracking program 0.05 Spreadshee t program 0.10 Web browser T planner 0.05 -0.10 0.15 -$65,000 $750,000 $675,000 $607,500 -$20,800 $250,000 $262,500 $275,625 -$39,000 $500,000 $525,000 $551,250 -$130,000 $1,000,000 $1,100,000 $1,210,000 -$97,500 $2,500,000 $2,875,000 $3,306,250 -$325,000 $1,300,000 $1,365,000 $1,433,250 1 1 0.8929 3 0.7972 0.7118 NPV $1,575,155 $607,862 $1,218,324 $2,501,025 $6,779,899 | $2,944,043

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter12: Balanced Scorecard And Other Performance Measures

Section: Chapter Questions

Problem 11MC: Dixon Construction Materials has collected this information: Based on this Information, what is the...

See similar textbooks

Similar questions

me IRR-Mutually exclusive projects Bell Manufacturing is attempting to choose the better of two mutually exclusive projects for expanding the firm's warehouse capacity. The relevant cash flows for the projects are shown in the following table: . The firm's cost of capital is 15%. Options a. Calculate the IRR for each of the projects. Assess the acceptability of each project on the basis of the IRRS. b. Which project is preferred? a. The internal rate of return (IRR) of project X is %. (Round to two decimal places.) Is project X acceptable on the basis of IRR? (Select the best answer below.) No O Yes The internal rate of return (IRR) of project Y is %. (Round to two decimal places.) Is project Y acceptable on the basis of IRR? (Select the best answer below.) O Yes Click to select your answer(s). O Type here to search
Dixon Construction Materials has collected this information: Based on this Information, what is the EVA for the project? A. $100,000 B. $10,000 C. $450,000 D. ($110,000)
All techniques with NPV profile-Mutually exclusive projects Projects A and B, of equal risk, are alternatives for expanding Rosa Company's capacity. The firm's cost of capital is 12%. The cash flows for each project are shown in the following table: a. Calculate each project's payback period. b. Calculate the net present value (NPV) for each project. c. Calculate the internal rate of return (IRR) for each project. d. Indicate which project you would recommend. GICKER a. The payback period of project A is years. (Round to two decimal places.) The payback period of project B is years. (Round to two decimal places.) b. The NPV of project A is $. (Round to the nearest cent.) The NPV of project B is $. (Round to the nearest cent.) c. The IRR of project A is%. (Round to two decimal places.) The IRR of project B is%. (Round to two decimal places.) d. Which project will you recommend? (Select the best answer below.) OA. Project B OB. Project A
Data pertaining to investment proposals is provided below: A B D -$40,000 $57,600 $17.600 Investment required -$260,000 $505,900 $245.900 -$125,000 -$640,000 $224,300 $99.300 6. Present vahue of cash inflows $1.021,400 NPV Usefil lfe of the project $381.400 6 Calculate project profitability index to rank proposals in tem of preference. Answer Choices: Project Investment profitability a. proposal Rank index preference 0.95 0.44 0.79 0.60 A 1st B 4th 2nd 3rd Project Investment profitability ь. proposal Rank preference 1.95 index A 1st B 1.44 4th 1.79 1.60 2nd D 3rd Project Investment profitability proposal Rank index preference 0.49 0.31 A 1st B 4th 0.44 2nd 0.37 3rd Project Investment profitability d. proposal Rank index preference A 1.45 1st B 0.94 4th 1.29 1.10 2nd 3rd D
Table 1: The Planned Value of Work Done Schedule Jan Feb March Project A Project B Project C Project D 60,000 100,000 80,000 120,000 100,000 80,000 80,000 120,000 120,000 120,000 70,000 100,000 April 120,000 140,000 90,000 120,000 Мay 200,000 140,000 100,000 150,000 Based on the data obtained from each project, you have found out the value of work done on the 31st of March, which is shown in Table 2 below. Table 2: The Actual Value of Work Done and Direct Cost Incurred as of the 31st of March Project Actual Value of Work Done 300,000 250,000 250,000 280,000 Direct Cost Incurred A 220,000 180,000 200,000 240,000 Each project is supposed to contribute 10% profit and 8% orerhead to the compoany. You are requested to present to the company the turnorer as of the 31st of march. Prepare your answenr by answering the following que'stions. a) Calculate the planned ralue of work done, the total planned orerhead and the total profit contribution from all the. projects as of the 31st of March. b)…
All techniques with NPV profile Mutually exclusive projects Projects A and B, of equal risk, are alternatives for expanding Rosa Company's capacity. The firm's cost of capital is 15%. The cash flows for each project are shown in the following table a. Calculate each project's payback period. b. Calculate the net present value (NPV) for each project. c. Calculate the internal rate of return (IRR) for each project d. Indicate which project you would recommend years (Round to two decimal places.) a. The payback period of project A is The payback period of project B is years (Round to two decimal places.) b. The NPV of project A is $ The NPV of project B is $ c. The IRR of project A is The IRR of project B is 15.24% (Round to the nearest cent.) (Round to the nearest cent.) 15.92%. (Round to two decimal places.) (Round to two decimal places.) پہلے
Table 1: The Planned Value of Work Done Schedule March 120,000 120,000 70,000 100,000 Jan Feb Project A Project B Project C Project D 60,000 100,000 80,000 120,000 100,000 80,000 80,000 120,000 Аpril 120,000 140,000 90,000 120,000 May 200,000 140,000 100,000 150,000 Based on the data obtained from each project, you have found out the value of work done on the 31st of March, which is shown in Table 2 below. Table 2: The Actual Value of Work Done and Direct Cost Incurred as of the 31st of March Project Actual Value of Work Done 300,000 250,000 250,000 280,000 Direct Cost Incurred 220,000 180,000 200,000 240,000 A Each project is supposed to contribute 10% profit and 8% orerhead to the compoany. You are requested to present to the company the turnorer as of the 31st of march. Prepare your answer by answering the following questions. a) Calculate the planned ralue of work done, the total planned orerhead and the total profit contribution from all the projects as of the 31st of march. b)…
Table 1: The Planned Value of Work Done Schedule Jan Feb March Project A Project B Project C Project D 60,000 100,000 80,000 120,000 100,000 80,000 80,000 120,000 120,000 120,000 70,000 April 120,000 140,000 90,000 120,000 May 200,000 140,000 100,000 150,000 100,000 Based on the data obtained from each project, you have found out the value of work done on the 31st of March, which is shown in Table 2 below. Table 2: The Actual Value of Work Done and Direct Cost Incurred as of the 31st of March Actual Value of Work Done 300,000 250,000 250,000 280,000 Project Direct Cost Incurred 220,000 180,000 200,000 240,000 A Each project is supposed to contribute 10% profit and 8% overhead to the company. You are requested to present to the company the turnorer as of the 31st of march. Prepare your answenr by answering the following que'stions. la) Calculate the planned ralue of work done, the total planned orerhead and the total profit contribution from all the. projects as of the 31st of March. b)…
Question #1a) What is a â€œtransfer price?â€b) List and describe 3 main reasons for using transfer prices.Question #2Consider the following information about a potential project:Investment requiredExpected annual project revenueExpected annual project expensesRequired rate of returnCurrent division return on investment$3,000,000$6,000,000$5,550,00011%18%a) Calculate the projectâ€™s return on investment.b) Based solely on ROI, is this project in the firmâ€™s best interests? Why or why not?c) Is this project in the division managerâ€™s best interests? Why or why not?d) Perform DuPont Analysis on this project.e) What is the projectâ€™s residual income?Question #3List and describe five traits that can differentiate a customer that is relatively inexpensive to service from a customer that is relatively expensive to service.Question #4List and describe five actions a firm can take if a customer appears…
NPV and IRR Analysis Cummings Products Company is considering two mutually exclusive investments whose expected net cash flows are as follows: EXPECTED NET CASH FLOWS Year Project A Project B -$340 -$630 -528 210 -219 210 3 -150 210 1,100 210 820 210 990 210 -325 210 a. Construct NPV profiles for Projects A and B. Select the correct graph. A B VPVS) 1400 VPV(S) VPV(S) 1400 1400- 1200 1200- 1200- 1000 1000 1000 800 Project B 800- Project A 800 Project A 600 600- 600 400 400- Project A Project B 400 200 200 Project B 200 Cost of capiar5 20 -5 30 -5 5 +++ 10 20 25 30 -5 15 Cost of cntal% -200 Cost of capital %) 20 25 30 -200 -200 -400 -4001 -400I D VPVS) T
Calculate the payback period for each project Year Project A ($) Project B ($) Project C ($) 0 (Investment) -2,000 -$10,000 -$5,000 1 -2,000 -6,000 -2,000 2 800 4,000 5,000 3 600 3,000 5,000 4 600 2,000 5,000 5 400 2,000 2,000
Consider the following two projects, X and Y: Period Project X Project Y 0 $(100,000) $(120,000) 1 $22,000 $0 2 $22,000 $0 3 $22,000 $0 4 $22,000 $0 5 $45,000 $175,000 Regarding the internal rate of return, which of the following statements is correct? The internal rate of return of Project Y is greater than the internal rate of return of Project X. The internal rate of return of Project X is equal to the internal rate of return of Project Y. O The internal rate of return of Project X is greater than the internal rate of return of Project Y. The internal rate of return of Projects X and Y cannot be determined based on this information.