The Ziggy Trim and Cut Company can purchase equipment on sale for $4,300. The asset has a three-year life, will produce a cash flow of $1,200 in the first and second year, and -$3,000 in the third year. The interest rate is 12%. Calculate the project's NPV

a) The Home Design Enterprises is considering a new project which will require RM325,000 for new fixed assets. In the initial year, the project will also require RM160,000 for additional inventory and RM35,000 for additional accounts receivable. Short-term debt is expected to increase by RM100,000 and long-term debt is expected to increase by RM300,000. The project has a 5-year life. The fixed assets will be depreciated straight-line to a zero-book value over the life of the project. At the end of the project, the fixed assets can be sold for 25% of their original cost. The net of balor expected to generate annual sales of RM554,000 and costs of RM430,000. The tax working capital returns to its original level at the end of the project. project is Hoota rate is 35% and the required rate of return is 15%. Calculate: The (exham S) i. the initial cost of this project? eriT bricii vib 16 iii. Set civ. (ex the after-tax operating cash flow for year 1 to year 4? 100 serk the cash flow for…

The information below relates to the purchase of equipment: investment in the project: $10,000 Net annual cash inflows: 2,400 Working capital required: 5,000 Salvage value of the equipment: 1,000 Life of the project: 8 years At the completion of the project, the working capital will be released for use elsewhere. Compute the net present value of the project, using a discount rate of 10% $606 $8,271 ($1,729) $1,729

X will pay $80,000 for a project that will generate the following cash flows: YEAR 1 2 3 4 5 7 8 CASH FLOW $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $30,000 $30,000 The payback period for the investment is: O 7 years O 6.25 years O 7 years O 7.33 years

Project A requires an original investment of $64,300. The project will yield cash flows of $19,600 per year for seven years. Project B has a calculated net present value of $3,760 over a four-year life. Project A could be sold at the end of four years for a price of $14,000. Below is a table for the present value of $1 at Compound interest. Year 6% 10% 12% 1 0.943 0.909 0.893 2 0.890 0.826 0.797 3 0.840 0.751 0.712 4 0.792 0.683 0.636 5 0.747 0.621 0.567 Below is a table for the present value of an annuity of $1 at compound interest. Year 6% 10% 12% 1 0.943 0.909 0.893 2 1.833 1.736 1.690 3 2.673 2.487 2.402 4 3.465 3.170 3.037 5 4.212 3.791 3.605 Use the tables above. (a) Using the present value tables above, determine the net present value of Project A over a four-year life with salvage value assuming a minimum rate of return of 12%. Round your answer to two decimal places. Enter negative values as negative numbers.$fill in the blank 1 (b) Which…

A project requires an increase of $2100 in Net Working Capital at the beginning of the project, which will be fully recovered after the completion of the project.  Equipment with a book value of $11,000 will be sold at the end of the project for a salvage value of $6,000.  The tax rate is 20%.  What is the incremental free cash flow in the year following the end of the project? Question 3Answer a. $9100 b. $7100 c. $4900 d. $2900

Central Mass Ambulance Service can purchase a new ambulance for $200,000 that will provide an annual net cash flow of $50,000 per year for five years. The salvage value of the ambulance will be $25,000. Assume the ambulance is sold at the end of year 5. Calculate the NPV of the ambulance if the required rate of return is 9%. (Round your answer to the nearest $1.) A) $(10,731) B) $10,731 C) $(5,517) D) $5,517

Explorer Company is considering the following investment proposal: Initial investment:   Depreciable assets (straight-line) $28,800 Working capital 3,200 Operations (per year for 4 years):   Cash receipts $20,000 Cash expenditures 8,800 Disinvestment:   Salvage value of equipment $2,400 Recovery of working capital 3,200 Discount rate: 10 percent Additional information for interest rate of 10 percent and four time periods: Present value of $1 0.68301 Present value of an annuity of $1 3.16987 What is the net present value for the investment? Select one: a. $14,658 b. $35,503 c. $3,825 d. $7,327

Harris Corporation has provided the following data concerning an investment project that it is considering: Initial investment Annual cash flow Salvage value at the end of the project Expected life of the project Discount rate $ 160,000 $ 54,000 $ 11,000 O $67,000 O $160,516 O $516 O $(5,776) 4 15 per year years % Use Exhibit 7B-1 and Exhibit 7B-2, to determine the appropriate discount factor(s) using the tables provided. The net present value of the project is closest to:

A company is considering two mutually exclusive expansion plans. Plan A requires a $39 million expenditure on a large-scale integrated plant that would provide expected cash flows of $6.23 million per year for 20 years. Plan B requires a $12 million expenditure to build a somewhat less efficient, more labor-intensive plant with an expected cash flow of $2.69 million per year for 20 years. The firm's WACC is 10%. Calculate each project's NPV. Enter your answers in millions. For example, an answer of $10,550,000 should be entered as 10.55. Do not round intermediate calculations. Round your answers to two decimal places. Plan A: $.    million Plan B: $     million Calculate each project's IRR. Round your answers to one decimal place. Plan A:     % Plan B:     % By graphing the NPV profiles for Plan A and Plan B, determine the crossover rate. Round your answer to one decimal place.           % Calculate the crossover rate where the two projects' NPVs are equal. Round your answer to one…