Pharoah Automotive is considering adding state safety inspections to its service offerings. The equipment necessary to perform these inspections will cost $512,000 and will generate cash flows of $179,000 over each of the next five years. If the cost of capital is 14 percent, what is the MIRR on this project?(

Company X is considering an investment project that requires an initial outlay of $500,000 and is expected to generate annual cash flows of $150,000 for five years. The company's cost of capital is 10%. • Calculate the NPV of the proposed investment project. Determine whether it is financially viable for Company X.

Calculate the NPV for the following project, assuming that the cost of capital is 15 percent and that the initial after tax cost of starting the project is $5,000,000. Assume that it will provide after-tax operating cash inflows as shown below:Year 1:  $1,800,000 Year 2:  $1,900,000 Year 3:   $1,700,000 Year 4:   $1,300,000   Calculate the IRR for the following project.  The initial after tax cost is $5,000,000.  The project is expected to provide after-tax operating cash inflows of $1,800,000 in year 1, $1,900,000 in year 2, $1,700,000 in year 3 and $1,300,000 in year 4?   Calculate the IRR for the following project.  Assume that its initial after tax cost is $5,000,000 and it is expected to provide after-tax operating cash flows of ($1,800,000) in year 1, $2,900,000 in year 2, $2,700,000 in year 3 and $2,300,000 in year 4?

You are working on a bid to build 4 city parks a year for the next three years. This project requires the purchase of $1,000,000 of equipment that will be depreciated using straight-line depreciation to a zero book value over the three-year project life. The equipment can be sold at the end of the project for $12500. You will also need to invest $18,000 in net working capital for the duration of the project. The fixed costs will be $37,000 a year and the variable costs will be $148,000 per park. Your required rate of return is 14 percent and your tax rate is 21 percent.   Make sure your work includes the answers to the following questions.  What is the depreciation every year? What is the after-tax salvage value of the equipment at the end of the project? What is the change in net working capital at the beginning and the end of the project? What is the cash flow from assets (CFFA) at each time point? What is the estimated operating cash flow (OCF) the project must generate to make NPV…

ABC, Ltd. is considering the purchase of a new factory that will increase their capacity.  They plan to pay for the investment with an amortized bank loan.  The annual payments on the loan will be $963,000 per year, of which $363,000 of the first-year payment will be interest.  How will the payment and interest be treated in the cash flows for capital budgeting?

Niagra Falls Power and Light is considering a project that will produce annual cash flows of $37,500, $46,200, $56,900, and $22,400 over the next four years, respectively. What is the internal rate of return if the project has an initial cost of $113,500?

You have been tasked with recommending one of the two investment projects for acceptance by your company. Project 1 costs $100,000 to implement today (it is a cost), it will bring subsequent positive cash flows of $50,000 at the end of year one; and subsequently $30,000;  $45,000;  $8,000. Project 2 initial cost is $14,000, and subsequent cash flows are $7,000 per year for 3 years. Your company is using WACC of14% for both projects. a. Calculate NPV and IRR for each project, and decide which one to recommend. b. Calculate MIRR for projects A and B. Which project would you recommend based on MIRR? c. Find the crossover rate. What does this rate represent? Describe in YOUR OWN words.

A state highway department is considering a bypass loop that is expected to save motorists $821,000 per year in gasoline and other automobile-related expenses. However, local businesses will experience revenue losses estimated to be $131,000 each year. The cost of the loop will be $8,900,000. Calculate the conventional B/C ratio using an interest rate of 7% per year and a 10-year project period.

A project requires an initial investment of $55.09 million to buy new equipment, and will provide after-tax cash flows of $21 million per year for 4 years. What is the project's internal rate of return?

Goergen Corporation is considering a capital budgeting project that would require an initial investment of $700,000. The investment would generate annual cash inflows of $267,000 for the life of the project, which is 4 years. The company's discount rate is 10%. The net present value of the project is closest to: Click here to view Exhibit 14B-1 and Exhibit 14B-2, to determine the appropriate discount factor(s) using the tables provided. Multiple Choice $368,000 $700,000 $846,123 $146,123