Required: Machine B is expected to produce the given real cash flows. Machine C was purchased five years ago for $200,000 and produces an annual real cash flow of $80,000. It has no salvage value but is expected to last another five years. The company can replace machine C with machine B either now or at the end of five years. The real opportunity cost of capital is 10%. What is the NPV of machine B? What is the EAC? When should the company replace machine C? Note: Use cells A8 to B13 from the given information to complete this question. You must use the built-in Excel function to answer this question. EAC should display as a positive number. Input area: CO C1 C2 C3 Years of cash flows Cost of capital Output area: NPV EAC Replace $ sssss $ $ $ (120,000) 110,000 121,000 133,000 3 10%

A project that costs $2,300 to install will provide annual cash flows of $730 for each of the next 5 years. a. Calculate the NPV if the opportunity cost of capital is 12%? (Do not round intermediate calculations. Round your answer to 2 decimal places.) NPV b. Is this project worth pursuing? Yes O No c. What is the project's internal rate of return IRR? (Do not round intermediate calculations. Round your answer to 2 decimal places.) %24

Suppose Acme Manufacturing Corporation's CFO is evaluating a project with the following cash inflows. She does not know the project's initial cost; however, she does know that the project's regular payback period is 2.5 years. Year Year 1 Year 2 Year 3 Year 4 Cash Flow $350,000 $500,000 $450,000 $475,000 If the project's weighted average cost of capital (WACC) is 7%, what is its NPV? O $334,825 $418,531 O $355,751 $397,604

Brunette Company is contemplating investing in a new piece of manufacturing machinery. The amount to be invested is $180,000. The present value of the future cash flows generated by the project is $163,000. Should they invest in this project? Oa. yes, because the rate of return on the project is equal to the desired rate of return used to calculate the present value of the future cash flows Ob. no, because net present value is +$17,000 Oc. no, because the rate of return on the project is less than the desired rate of return used to calculate the present value of the future cash flows Od. yes, because the rate of return on the project exceeds the desired rate of return used to calculate the present value of the future cash flows

Vishano

Giant Machinery Ltd is considering to invest in one of the two following Projects to buy a new equipment. Each project will last 5 years and have no salvage value at the end. The company’s required rate of return for all investment projects is 9%. The cash flows of the projects are provided below.   Project 1Cost $175,000 Project 2 Cost $185,000 Future Cash Flows For Project 1 Year 1 Year 2 Year 3 Year 4 Year 5  is 76,000 83,000 67,000 65,000 55,000 respectively. For Project 2 it is  87,000 78,000 69,000 65,000 57,000 for Year 1 Year 2 Year 3 Year 4 Year 5 resp.  Required: a) Identify which project should the company accept based on NPV method. (Note: Please round up the result of each calculation of PV to 2 decimal places only for simplification)  b) Identify which project should the company accept based on simple pay back method if the payback criteria is maximum 2 years.  c) Which project Giant Machinery should choose if two methods are in conflict

A company that manufactures magnetic flow meters expects to undertake a project that will have the cash flows estimated. First cost, $ -810,000 Equipment replacement cost in year 2, $ -300,000 Annual operating cost, $/year Salvage value, $ Life, years -860,000 250.000 4 an interest rate of 10% per year, what is the equivalent annual cost of the project? Find the AW value using tabulated factors. e equivalent annual cost of the project is $-820000

howell petroleum, incorporatred, is trying to evaluate a generation project with the following cash flows: year 0 -39,300,000 year 1 63,300,000 year 2 -12,300,000 What is the NPV for the project if hte company requires a return of 12 percent? this project has two irr what are they

What information does the payback period provide? Suppose Omni Consumer Products's CFO is evaluating a project with the following cash inflows. She does not know the project's initial cost; however, she does know that the project's regular payback period is 2.5 years. Year Year 1 Cash Flow $375,000 Year 2 $450,000 Year 3 $400,000 Year 4 $400,000 If the project's weighted average cost of capital (WACC) is 10%, what is its NPV? $261,541 $313,849 $287,695 $222,310 Which of the following statements indicate a disadvantage of using the discounted payback period for capital budgeting decisions? Check all that apply. ㅁㅁ The discounted payback period is calculated using net income instead of cash flows. The discounted payback period does not take the project's entire life into account. The discounted payback period does not take the time value of money into account.