Colorado Springs painter and graphic designer Steve Weed is investing $66,000 in assets to expand his fine art business. These assets cannot be salvaged at the end of the project. Weed expects operating cash flows of $27,900 per year for 4 years as a result of the expansion. If $4,200 of net working capital are needed throughout the life of the project, what is the NPV of the expansion?  Note: Steve Weed faces a 10% cost of capital. a. $22,439 b. $26,046 c. $21,108 d. $27,493 e. $24,309

The Fizzy Beverage Co. is considering two alternative capital projects. Project 1: expansion of its existing traditional line of Fizzy beverages. Project 2: introduction of a new “healthy” line of beverages. The company has already spent $1,400,000 on research into the feasibility of these projects and has arrived at the following financial projections.   ·      Both projects are estimated to have a life of 5 years. The required fixed asset investment or capital spending for project 1 is $30,000,000 and for project 2 is $35,000,000. Fixed assets will be depreciated straight line to zero. Fixed asset salvage value estimate for project 1 is $6,200,000 and for project 2 is $8,500,000 ·      In order to support anticipated sales, either project will require an increase in inventory of $8,600,000, an increase in accounts receivable of $2,800,000, and an increase in accounts payable of $6,300,000 ·      Cost of goods sold is projected at 35% of sales for either project. Selling,…

DDR Enterprises is analyzing an expansion project.  The project's installed cost is $80,000.  It is eligible for 100% bonus depreciation.  The project has a $12,000 salvage value at the end of its five year expected life.  The project will requie an additional $8,000 investment in net working capital.  The tax rate is 25%.  What is the project's initial investment?   If you could show the steps in calcualtion too that would be great!

The following details taken from the books of DiDi Sdn Bhd for the year ending 31 December 2020.   DiDi Sdn Bhd Statement Profit or Loss for the year ending 31 December 2020 (extract)   RM RM Gross profit   44,700 Add : Discount received 410   Profit on sale of van 620       1,030     45,730 Less: Expenses     Motor expenses 1,940   Wages 17,200   General expenses 830   Bad debts 520   Increase in allowance for doubtful debts 200   Depreciation : van 1,800       22,490     23,240   Statement of Financial Position as at 31 December   2019   2020     RM RM RM RM Non-current Assets         Vans at cost   15,400   8,200 less Depreciation   (5,300)   (3,100)     10,100   5,100 Current Assets         Inventory 18,600   24,000   Trade accounts receivables less provision*…