As Financial Manager what would be your decision on assets and investment matters to meet profit maximization? Analyze carefully and encircle your best answer. A financial manager must choose between four alternative Assets: 1, 2, 3, and 4. Each asset costs P35,000 and is expected to provide earnings over three years as described below. 1. Based on the profit- maximization goal, the financial manager would choose ASSET YEAR YEAR A. Asset 1 2 21,000 | 15,000 6,000 9,000 15,000 21,000 3,000 20,000 | 19,000 6,000 | 12,000 | 12,000 1 B. Asset 2 1 C. Asset 3 2 D. Asset 4 3 4
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- According to Wald's criterion, which investment is decided by looking at the profitability of three investments such as S1, S2 and S3 in the following economic environments? Ekonomik Durumlar S1 S2 S3Canlı Ekonomik Durum 13 6 7Normal Ekonomik Durum 10 9 8Durgun Ekonomik Durum 7 14 4Resesyon Durumu 8 7 15 Economic Conditions S1 S2 S3 Vivid Economic Situation 13 6 7 Normal Economic Condition 10 9 8 Stagnant Economic Condition 7 14 4 Recession Condition 8 7 15According to Wald's criterion, which investment is decided by looking at the profitability of three investments such as S1, S2 and S3 in the following economic environments? Economic Conditions S1 S2 S3 Vivid Economic Situation 13 6 7 Normal Economic Condition 10 9 8 Stagnant Economic Condition 7 14 4 Recession Condition 8 7 15Kabriel Company must choose between two assets purchases. The annual rate of return and related probabilities given below summarize the firm’s analysis. i. Calculate the expected return ii. Compute the standard deviation of the expected return iii. Which asset should this company select? Justify your answer.
- In Management Accounting, there are some investment appraisal methods to analyse the performance of investment projects. The following table lists out the financial data of two projects for London Technology Ltd: Projects/Methods A B Payback Period 2 year and 4 months 2 year and 9 months Accounting Rate of Return 27.6% 15.44% Net Present Value £23,040 £21,798 Required: Which project should company accept? In the discussion, please explain which method can lead to better decision.What is the first step in preparing a financial plan? Group of answer choices A forecast of revenue over some future time period Estimate how many additional assets the company will need Estimate the funds needed to implement the strategies Determine the expected level of profits for future periodsIn Management Accounting, there are some investment appraisal methods to analyse the performance of investment projects. The following table lists out the financial data of two projects for London Technology Ltd: Projects/Methods A B Payback Period 2 year and 4 months 2 year and 9 months Accounting Rate of Return 27.6% 15.44% Net Present Value £23,040 £21,798 Required: Which project should company accept? In the discussion, please explain which method can leads to better decision.
- REQUIRED Calculate the Payback Period of Machine A (expressed in years, months and days). Calculate the Net Present Value of both Calculate the Accounting Rate of Return on initial investment (expressed to two decimal places) of both machines. Calculate the Internal Rate of Return of Machine B (expressed to two decimal places). If the time value of money is taken into account, which machine should be chosen? Why? INFORMATION The directors of Lomax Ltd intend expanding the company and they have the choice of purchasing one of two machines at the end of 2022 viz. Machine A or Machine B. Both machines have a five-year life, with only Machine A having a residual value of R300 000. The annual volume of production of each machine is estimated at 6 000 pallets (comprising 500 bricks each), which can be sold at R520 per pallet. Depreciation is calculated on the machines using the…The company is in search of resources for a new investment of TL 3,000,000. As a financial manager,a) Find the current weighted average cost of capital according to the resource distribution below.b) Discuss, what kind of financing strategy would you propose for the investment project in question.An investment firm is considering two alternative investments, A and B, under two possible future sets of economic conditions, good and poor. There is a .60 probability of good economic conditions occurring and a .40 probability of poor economic conditions occurring. The expected gains and losses under each economic type of conditions are shown in the following table: Economic Conditions Investment Good Poor A $900,000 –$800,000 B 120,000 70,000 Using the expected value of each investment alternative, determine which should be selected.
- 1. The president of the Martin Company is considering two alternative invest- ments, X and Y. If each investment is carried out, there are four possible outcomes. The present value of net profit and probability of each outcome follow: Investment X Investment Y Net Present Net Present Outcome Value Probability Outcome Value $12 million Probability 0.1 $20 million 0.2 A 8 million 10 million 2 0.3 B 9 million 0.3 3 0.4 6 million 0.1 3 million 0.1 D 11 million 0.5 a. What are the expected present value, standard deviation, and coefficient of variation of investment X? b. What are the expected present value, standard deviation, and coefficient of variation of investment Y? c. Which investment is riskier? d. The president of the Martin Company has the utility functionThe income statement comparison for Rush Delivery Company shows the income statement for the current and prior year. A. Determine the operating income (loss) (dollars) for each year. B. Determine the operating income (percentage) for each year. C. The company made a strategic decision to invest in additional assets in the current year. These amounts are provided. Using the total assets amounts as the investment base, calculate the ROI. Was the decision to invest additional assets in the company successful? Explain. D. Assuming an 8% cost of capital, calculate the RI for each year. Explain how this compares to your findings in part C.Use the following information to answer the questions that follow. A. Calculate the operating income percentage for each of the courses. Comment on how your analysis has changed for each course. B. Perform a vertical analysis for each course. Based on your analysis, what accounts would you want to investigate further? How might management utilize this information? C. Which method of analysis (using a dollar value or percentage) is most relevant and/or useful? Explain