On August 1, Rantoul Stores Inc. is considering leasing a building and purchasing the necessary equipment to operate a retail store. Alternatively, the company could use the funds to invest in $1,000,000 of 4% U.S. Treasury bonds that mature in 15 years. The bonds could be purchased at face value. The following data have been assembled: Cost of store equipment $1,000,000 Life of store equipment 15 years Estimated residual value of store equipment $50,000 Yearly costs to operate the store, excluding     depreciation of store equipment $200,000 Yearly expected revenues—years 1–6 $300,000 Yearly expected revenues—years 7–15 $400,000   1.  Prepare a differential analysis as of August 1 presenting the proposed operation of the store for the 15 years (Alternative 1) as compared with investing in U.S. Treasury bonds (Alternative 2). If an amount is zero, enter "0". Differential AnalysisOperate Retail (Alt. 1) or Invest in Bonds (Alt. 2)August 1   Operate Retail (Alternative 1) Invest in Bonds (Alternative 2) Differential Effects (Alternative 2) Revenues $ $ $f Costs:       Costs to operate store       Cost of equipment less residual value       Profit (loss) $ $ $   3.  If the proposal is accepted, what would be the total estimated operating income of the store for the 15 years? $

Bramble Corp. is purchasing new equipment with a cash cost of $312000 for an assembly line. The manufacturer has offered to accept $67900 payment at the end of each of the next six years. How much interest will Bramble Corp. pay over the term of the loan? O $95400. O $312000. O $67900. O $407400.

A corporation can buy a machine for 15,000$ with life of five years and a salvage value (selling price of the machine at end of life of the project) of 1,550$. Net revenues per year are expected to be 7,000$. MARR for this corporation is 15%. Should the corporation invest in this machine? Solve by present worth method.   detailed answer without using excel

National Cruise is considering purchasing a new ship that will cost $600,000,000. The president of the company asked the CFO to analyze cash flows associated with operating the ship under two alternative itineraries: Itinerary 1, Caribbean Winter/ Alaska and Itinerary 2, Caribbean/ Eastern Canada. The CFO estimatedt he following cash flows, which are expected to apply to each of the next 15 years:                                                     Caribbean/ Alaska     Caribbean/ E. Canada Net revenue                                   $120,000,000                 $105,000,000 Less:    Direct program expenses             ($25,000,000)                 ($24,000,000)    Indirect program expenses          ($20,000,000)                 ($20,000,000)    Non- operating expenses            ($21,000,000)                 ($21,000,000) Add back depreciation                   $115,000,000                 $155,000,000 Cash flow per year                           $169,000,000…

Harding Company is in the process of purchasing several large pieces of equipment from Danning Machine Corporation. Several financing alternatives have been offered by Danning:1. Pay $1,000,000 in cash immediately.2. Pay $420,000 immediately and the remainder in 10 annual installments of $80,000, with the first installment due in one year.3. Make 10 annual installments of $135,000 with the first payment due immediately.4. Make one lump-sum payment of $1,500,000 five years from date of purchase.Required:Determine the best alternative for Harding, assuming that Harding can borrow funds at an 8% interest rate.

On August 1, Rantoul Stores Inc. is considering leasing a building and purchasing the necessary equipment to operate a retail store. Alternatively, the company could use the funds to invest in $900,000 of 3% U.S. Treasury bonds that mature in 15 years. The bonds could be purchased at face value. The following data have been assembled:   Revenues/costs Amount Cost of store equipment $900,000 Life of store equipment 15 years Estimated residual value of equipment $45,000 Annual store operating costs less depreciation 200,000 Annual expected revenues in years 1-6 250,000 Annual expected revenues in years 7-15 300,000 Prepare a differential analysis as of August 1 presenting the proposed operation of the store for the 15 years (Alternative 1) as compared with investing in U.S. Treasury bonds (Alternative 2). Based on the results disclosed by the differential analysis, should the proposal be accepted? If the proposal…

The management of ProdPharm.inc has decided to increase the production capacity of its factory by purchasing a new production line. This new acquisition will be financed by bank debt. The company consulted several banks to have the interest rate applied for this type of investment. Bank (A) charges an annual nominal rate of 12%. Bank (B) applies a semi-annually capitalized nominal rate of 11.8%. Bank (C) applies a quarterly capitalized nominal rate of 11.6%.               Bank (D) applies a monthly compounded nominal rate of 11.5%. What is the rate monthly headcount best for the business? Show all your interest rate equivalence calculations. Keep 6 digits after the decimal point.