planning to install wind turbines to provide enhanced evaporation of reverse osmosis concentrate from its inland desalting plant. The company will spend Php1.5 million in year 1 and Php2 million in year 2. Annual maintenance is expected to cost Php65,000 per year through year 10. Determine the equivalent annual cost of the project in years 1 through 10 at an interest rate of 6% per year.

Q: Capital Investment Analysis; Jones Excavation Company is planning an investment of $190,800 for a…

A: Net Present Value=(Present Value of Cash Inflows-Present Value of Cash Outflows)

Q: A project capitalized for ₱25,000 invested in depreciable assets will earn a uniform, annual income…

A: Here, Investment = I = P 25,000 Uniform annual income = P 29,647 O & M cost = P 5,000 Taxes and…

Q: Germaine Metals is considering installing a new molding machine which is expected to produce…

A: NPV is also known as Net Present Value.. It is a capital budgeting technique which helps in decision…

Q: What will be the equivalent uniform annual amount that will be deposited in a bank for 15 years that…

A: Time Period 15 Initial Cost  P20,00,000.00 Additional Cost at the end evry 5th year…

Q: r pipeline system is installed in an industrial site that requires ₱12,500,000 initial investment.…

A: Capitalized cost of project are present value of all cost that would occur in future over the period…

Q: Blue Demon Cycle Shop is considering the purchase of used mopeds to be rented to city tourists.  The…

A: Here Given Information Mopeds Cost =$18,922.41 Annual Cash Flows =$5,000 Time Period =6 Years Cost…

Q: The asking price (initial investment) for a project is $290,000. The end of year after tax cash…

A: Initial Investment = $290,000 Cash flow for year 1 = $80,000 Cash flow for year 2 = $80,000 Cash…

Q: Fox Hollow Franks is looking at a new system with an installed cost of $540,000. This equipment is…

A: The NPV of a project refers to the measure of the profitability of the project calculated by…

Q: KUST is evaluating a new project for hangu campus. The financial manager has determined that the…

A: Payback pereiod is the time required for the project to cover its intial investment. It can be…

Q: Sawtooth Machinery is considering a 4-year project to manufacture a new line of chainsaws. The…

A: Years 1 to 4:For each of these years, calculate the cash flow using the above formula. Note that…

Q: Nusajaya Sport Planet is planning to construct a Basketball Sport Arena on which has 50 courts to be…

A: Net present value is the difference between Present Value of cash Inflows and Initial Investment.

Q: A project capitalized for ₱47,000 invested in depreciable assets will earn a uniform, annual income…

A: The rate of return may be used for real estate, bonds, equities, and fine art. The rate of return…

Q: Blossom Corp. management is planning to convert an existing warehouse into a new plant that will…

A: The payback period is the amount of time it takes to recover the initial cash outflow. The NPV is…

Q: Dairy queen corporation has been awarded a contract to supply a key replacement part for its ice…

A: Required Return = 16% N = 8 years Initial Investment = Equipment Cost + Working Capital Needed…

Q: Using the Accounting Rate of Return (AROR) methods, should the project is acceptable or rejected?.

A: Computation of Average Annual Revenue from Squash Sport Arena               (in MYR) Year 1 2 3…

Q: project requires an initial investment of P300,000 on equipment. The project will generate sales…

A: Salvage value of equipment 0 as it will be sold at book value that is 300000, so no depreciation…

Q: An investment is be made with an initial capital of PHP 853512. It is expected that there will be an…

A: Payback period Payback period is a capital budgeting tool to decide on the best investment…

Q: TECO, has been tasked with evaluating two designs for the new plant with a 10-year horizon. Interest…

A: With annual interest rate (r) and number of compounding in a year (m), the effective annual rate is…

Q: An equipment with an estimated lifespan of 10 years is to be bought for Php 1,500,000. It will…

A: Initial Investment Cost (Year 0) I = Php 1,500,000Annual Revenue A= Php 400,000Annual Operating and…

Q: A new molding machine is expected to produce operating cash flows of $109,000 per year for 4 years.…

A: Net present value refers to the technique of capital budgeting used to evaluate the profitability…

Q: A new IS project is to be developed with an initial cost of1.5million and a maintenance cost of…

A: In a typical capital budgeting project, we have to find the payback period, NPV and IRR.

Q: Dhofar water is installing new equipment at a cost of 140000 OMR. Expected cash flows from this…

A: Discounted payback period is the number of years it would take to recover the cost of the project…

Q: Determine the NPV for the project.

A: Net Present Value: It is the amount computed from the difference between discounted cash flows and…

Q: g to construct a Football Sport Arena on which has 50 courts to be used at any point of time. The…

A: Net present value is difference between the present value of cash flow and initial investment and it…

Q: Business Monkey is evaluating a 3-year project that would involve buying a new piece of equipment…

A: NPV (Net Present Value) assesses investment profitability by calculating the present value of future…

Q: A toy manufacturer is considering the installation of a new process machine for the toy…

A: Internal rate of return is the rate at which net present value of the cash inflows and cash outflows…

Q: The construction of a bypass road needs a capital investment of $200,000 and $10,000 would be…

A: Note: We’ll answer the first question since the exact one wasn’t specified. Please submit a new…

Q: Vermont Technology is considering a project that would last for 3 years and have a cost of capital…

A: The correct answer is None of the above is within $10 of the correct answer. This is because the…

Q: A water Reservoir will have a first cost of Php 10,000,000,000, an annual maintenance cost of…

A: First cost (C) = Php 10,000,000,000 Annual maintenance cost (A) = Php 35,000,000 Reconstruction cost…

Q: Fox Hollow Franks is looking at a new system with an installed cost of $540,000. This equipment is…

A: The NPV of a project refers to the measure of the profitability of the project calculated by…

Q: The initial investment in a government-funded city flood control system is $500,000. From the…

A: In this we have to find out total present value of all cost.

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.