Cash flows estimation and capital budgeting: You are the head of finance department in XYZ Company. You are considering adding a new machine to your production facility. The new machine’s base price is $10,000.00, and it would cost another $2,140.00 to install it. The machine falls into the MACRS 3-year class (the applicable MACRS depreciation rates are 33.33%, 44.45%, 14.81%, and 7.41%), and it would be sold after three years for $1,750.00. The machine would require an increase in net working capital (inventory) of $810.00. The new machine would not change revenues, but it is expected to save the firm $33,605.00 per year in before-tax operating costs, mainly labor. XYZ's marginal tax rate is 34.00%. If the project's cost of capital is 15.90%, what is the NPV of the project? Round your answer to two decimal places. For example, if your answer is $345.667 round as 345.67 and if your answer is .05718 or 5.718% round as 5.72.

fINANCE   Bellinger Industries is considering two projects for inclusion in its capital budget, and you have been asked to do the analysis. Both projects' after-tax cash flows are shown on the time line below. Depreciation, salvage values, net operating working capital requirements, and tax effects are all included in these cash flows. Both projects have 4-year lives, and they have risk characteristics similar to the firm's average project. Bellinger's WACC is 11%. 0 1 2 3 4 Project A -1,250 650 450 230 280 Project B -1,250 250 385 380 730 What is Project A's MIRR? Do not round intermediate calculations. Round your answer to two decimal places. % Hide Feedback Partially Correct Check My Work Feedback Review the MIRR equation. The solution for MIRR is a percentage rate not a dollar value. Review the NPV equation definition. Don't discount the Year 0 cash flow since its PV is simply -1,250. The MIRR calculation is dependent on the firm's WACC. What is Project B's MIRR? Do not round…

Quantitative Problem: Bellinger Industries is considering two projects for inclusion in its capital budget, and you have been asked to do the analysis. Both projects' after-tax cash flows are shown on the time line below. Depreciation, salvage values, net operating working capital requirements, and tax effects are all included in these cash flows. Both projects have 4-year lives, and they have risk characteristics similar to the firm's average project. Bellinger's WACC is 11%. 2 .!!!!! 590 360 230 300 Project A -1,100 Project B -1,100 3 220 360 280 700 What is Project Delta's IRR? Do not round intermediate calculations. Round your answer to two decimal places.

Cash flows estimation and capital budgeting:You are the head of finance department in XYZ Company. You are considering adding a new machine to your production facility. The new machine’s  base price is $10,800.00, and it would cost another $2,760.00 to install it. The machine falls into the MACRS 3-year class (the applicable MACRS depreciation rates are 33.33%, 44.45%, 14.81%, and 7.41%), and it would be sold after three years for $2,350.00. The machine would require an increase in net working capital (inventory) of $800.00. The new machine would not change revenues, but it is expected to save the firm $23,845.00 per year in before-tax operating costs, mainly labor. XYZ's marginal tax rate is 35.00%.   a. What is the initial cash outlay? b. What is the free cash flow for year 1? c. What is the additional Year-3 cash flow (i.e, the after-tax salvage and the return of working capital – also called terminal value)?  (please show your work in details and highlight your answers)

Quantitative Problem: Bellinger Industries is considering two projects for inclusion in its capital budget, and you have been asked to do the analysis. Both projects' after-tax cash flows are shown on the time line below. Depreciation, salvage values, net operating working capital requirements, and tax effects are all included in these cash flows. Both projects have 4-year lives, and they have risk characteristics similar to the firm's average project. Bellinger's WACC is 11%.     0 1 2 3 4                       Project A -1,050 600 360 300 290 Project B -1,050 200 295 450 740   What is Project A’s IRR? Do not round intermediate calculations. Round your answer to two decimal places. _________ % What is Project B's IRR? Do not round intermediate calculations. Round your answer to two decimal places.  _________% If the projects were independent, which project(s) would be accepted according to the IRR method?   If the projects were mutually exclusive, which…

Bottoms up Diaper Service is considering the purchase of a new industrial washer. It can purchase the washer for $3,600 and sell its old washer for $900. The new washer will last for 6 years and save $1,100 a year in expenses. The opportunity cost of capital is 20% and the firms tax rate is 21%. a) if the firm uses straight-line depreciation over a 6 year life, what are the cash flows of the project in years 0 to 6?  The new washer will have zero salvage value after 6 years, and the old washer is fully depreciated.  (negative amounts should be indicated by a minus sign.)  annual operating cash flow in year 0?  annual operating cash flow in years 1 to 6? b) what is the project NPV? (Do not round intermediate calculations. round answer to 2 decimal places. c) what is the NPV if the investment is entitled to immediate 100% bonus depreciation? (do not round intermediate calculations. round your answer to 2 decimals places.

NPV (net present value) Craig is considering several capital investments for the upcoming year.  Use the NPV (net present value) method to determine whether the company should investment in the following independent projects: Project 1 costs $28,000 and offers 8 annual cash flows of $8,600.  Craig feels this type of investment should  require an annual return of 16% on projects like this.  Project 2 costs $35,000 and offers 6 annual cash flows of $12,000.  Craig feels this type of investment should  require an annual return of 12% on projects like this.  Requirements 1.  Calculate the NPV of both of these projects  2. What is the maximum acceptable price Craig should pay for each of these projects?

Cash flows estimation and capital budgeting:You are the head of finance department in XYZ Company. You are considering adding a new machine to your production facility. The new machine’s  base price is $10,000.00, and it would cost another $2,400.00 to install it. The machine falls into the MACRS 3-year class (the applicable MACRS depreciation rates are 33.33%, 44.45%, 14.81%, and 7.41%), and it would be sold after three years for $2,150.00. The machine would require an increase in net working capital (inventory) of $870.00. The new machine would not change revenues, but it is expected to save the firm $31,775.00 per year in before-tax operating costs, mainly labor. XYZ's marginal tax rate is 35.00%.If the project's cost of capital is 12.50%, what is the NPV of the project?Round your answer to two decimal places. For example, if your answer is $345.667 round as 345.67 and if your answer is .05718 or 5.718% round as 5.72. Group of answer choices $40,993.57 $10,000.00 $38,124.02…

Quantitative Problem: Bellinger Industries is considering two projects for inclusion in its capital budget, and you have been asked to do the analysis. Both projects' after-tax cash flows are shown on the time line below. Depreciation, salvage values, net operating working capital requirements, and tax effects are all included in these cash flows. Both projects have 4-year lives, and they have risk characteristics similar to the firm's average project. Bellinger's WACC is 9%.     0 1 2 3 4                       Project A -900 600 365 280 330 Project B -900 200 300 430 780   What is Project A's payback? Do not round intermediate calculations. Round your answer to four decimal places.  years What is Project A's discounted payback? Do not round intermediate calculations. Round your answer to four decimal places.  years What is Project B's payback? Do not round intermediate calculations. Round your answer to four decimal places.  years What is Project B's…

The management of Peridot Inc. is submitting a proposal to the Board of Directors for a new facility with the following cash flows. Year Cash flow 0 -214 1 52 2 61 3 74 4 82   The company's hurdle rate is 9%. internal rate of return for the proposed project is closest to:     A. 10.15%.   B. 9.06%.   C. 9.00%.