w machine costing $150,000 is expected to save the McKaig Brick Company $11,000 per year for 5 years before depreciation and taxes. The machine will be depreciated on a straight-line basis for a 5-year period to an estimated salvage value of $0. The firm’s marginal tax rate is 40 percent. What are the annual net cash flows associated with the purchase of this machine? Round your answer to the nearest dollar. $   Compute the net investment (NINV) for this project. Round your answer to the

Q: 4. A note having a face value of P9,300 was discounted at 11%. If the proceeds were 8,788.50. Find…

A: Discount notes are securities that are issued at a discount to par value. This is the difference…

Q: 2. Suppose the Investment Yield on a 182-day T bill is 4%. What is its discount-basis yield?

A: Given, n= 182 days T bill = 4%  Investment Yield = ?  Discount-basis yield= ?

Q: Student Fasked money amounting to P 9,000 from his parents on the first month 2020 and 12,000 on…

A: Here, Amount taken from parents in the first month of 2020 = P9,000 Amount taken from parents in the…

Q: (Liquidity analysis)  When firms enter into loan agreements with their​ bank, it is very common for…

A: In finance various financial ratios are used to assess the financial health of a company. One of…

Q: A 5-year project will require an investment of $100 million. This comprises of plant and  machinery…

A: Here, Increase in Revenue is $120 million Expenses is $80 million per year Tax Rate is 30%…

Q: opportunity cost? Depreciation Given the choice, would a firm prefer to use MACRS depreciation or…

A: Depriciation:- Depreciation is an accounting method that is used to divide or allocate Cost of a…

Q: In the accompanying diagram, what is the value of K on the left-hand cash-flow diagram that is…

A: Present value of future amount With interest or discount rate (i), period (n) and future value (FV),…

Q: Why was the salvage value used in calculating the depreciation expense?

A: This method also called diminishing balance method or declining balance method where the…

Q: Greene, Inc.'s balance sheet indicates that the book value of​ stockholders' equity​ (book value per…

A: Market-to-book ratio is simply a comparison of book value with market value. It can be calculated…

Q: Cross-Ocean Boats Ltd. is in the 30% tax bracket. It is interested in determining the minimum return…

A: Data given: 1. 6% semi-annual coupon Bonds outstanding=3000.   Mature = 12 years  Sale price of…

Q: Company RS’s bonds outstanding have a coupon rate of 6% and semiannual payments. If the YTM  on this…

A: A Bond refers to an instrument that represents the loan being made by the investor to the company…

Q: ast year Triangular Resources earned $5.4 million in net operating income and had an operating…

A: The total investment in sales can be calculated by combining the formulas of operating profit margin…

Q: Construct a market weighted index using 3 stocks below over a one year period to find the index…

A: Assume the index at T0 is 100. Hence

Q: discuss the entire Philippine financial system, specifically the banking and non-banking financial…

A: Financial institutions, also known as banking institutions, are business entities that act as…

Q: 9. Calculating Project OCF H. Cochran, Inc., is considering a new three-year expansion project that…

A: Solution : Operating Cash Flow ( OCF) means that Cash flow which was generated by entity through his…

Q: Paul and Marie Weir moved from a community property state to a common law property state last year.…

A: Property acquired by one member of a married couple is owned entirely and alone by that individual…

Q: What will be the nominal RoR on a perpetual preferred stock with a $100 par value, a stated dividend…

A: Par value = $100 Dividend rate = 7% Annual dividend = 100*0.07 = $7

Q: How low can nominal interest rates go? Explain why they can become negative.

A: The nominal interest rate is the interest rate that is calculated before inflation is factored in.…

Q: Suppose you buy a one-year forward contract at $65. At expiration, the spot price is $73. The…

A: Value of the contract at expiration = Spot price - Futures price * e-(risk free rate * Time to…

Q: TRUE OR FALSE Financial sector creates products for the management of risk, thus risk can be…

A: Risk management is the process of identifying, analyzing, and accepting or mitigating uncertainty in…

Q: Q. It is July 16. A company has a portfolio of stocks worth $100 million. The beta of the portfolio…

A: Investors hold "long" security positions in the hope that the stock's value will grow in the future.…

Q: Dearborn Supplies has total sales of $206 ​million, assets of $94 ​million, a return on equity of…

A: Net income = Profit margin * Sales = 0.078 * $206 million = $16.068 million Equity = Net income /…

Q: 1. The following table presents the expected returns of three stocks and the risk free rate. Stock A…

A: Portfolio means a bunch of assets or investments. To reduce the risk, investors invest their funds…

Q: At a certain interest rate compounded semiannually, 5000 pesos will amount to 20 000 pesos after 10…

A: Future Value: The future value is the amount that will be received at the end of a certain period.…

Q: The additional return earned by holding a commodity that is in short supply or a nonpecuniary gain…

A: Answer- The Convenience Yield - A premium that is earned by people who hold a physical commodity.…

Q: 9. Kenny took a position short 10,000 pounds of February copper at $2.53 a pound. By December, the…

A: “Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: State of Economy Probability ABC Company Expected Return Expected Return XYZ Company Very Poor 0.30…

A: Solution : Co-Variance is calculated as follows. Co-Variance :   Dx * Dy / N…

Q: The firm's bank charges $18 per wire and $0.50 per EDT. The EDT takes one day longer to clear. The…

A: Since  The minimum transfer balance= TBAL TBAL=Incremental costDS×(K-ECR(1-RRR))365 Where: DS= Days…

Q: otse Automotive is planning to expand its operation by planning to add a machine costing $90.000.…

A: Solution : Company Will choose Loan V/S Lease option which provide the lower Negative option.

Q: A twenty-year annuity pays $940 per month at the end of each month. For the first seven years, the…

A: Present Value:  The present value is the value of cash flow stream or the fixed lump sum amount at…

Q: Suppose that you took out a mortgage loan and should repay $500 per month in the next 20 years. In…

A: Interest rate is the amount the lender charges the borrower and is the percentage of principal, or…

Q: Nestle Ltd. Production department realized that one of their machines needs to be replaced and the…

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

Q: Stock A has a beta of 1.2 and a standard deviation of 20%. Stock B has a beta of 0.8 and a standard…

A: Given: Particulars Beta Amount Stock A 1.2  $ 100,000 Stock B 0.8  $ 100,000      $ 200,000

Q: Pedro Gil Company must maintain a compensating balance of P50,000 in its checking account as one of…

A: Given: Loan amount = P500000 Interest paid on loan = 6% Compulsory compensating balance = P50000…

Q: Which of the following statements is false?   A.   Banks have high levels of liquidity assets and…

A: Duration of bond measures the sensitivity of prices of bonds with change in interest rate in the…

Q: The primary goal of a publicly-owned firm interested in serving its stockholders should be to:…

A: Solution:- Publicly-owned firms are those firms in which majority of the stocks are held by the…

Q: Explain what type of firms a Buyout Fund (or a Private Equity Fund) might target as part of a…

A: A leveraged buyout (LBO) is a type of business acquisition in which the vast majority of the cost of…

Q: QUESTION ONE Bahrain Gas Company dividend per share next year is expected to be 3.500. An analysis…

A: Expected dividend (D1) = 3.5 Average growth rate (g) = 5% pa According to dividend discounting model…

Q: 6. When Alice and Mark's first child was one month old, and at the end of every month thereafter,…

A: The equal payment flow which occurs for a finite period and ends after lapse of finite time period…

Q: In practice, a common way to value a share of a stock when a company pays dividends is to value the…

A: Stock price is defined as the maximum price that an investor is ready to pay for a stock. It is…

Q: A contract has been signed to lease a building at P50, 000 per year with an annual increase of P1,…

A: First year lease (L1) = P 50000 L2 = P 51000 L3 = P 52000 L4 = P 53000 L5 = P 54000 r = 7%

Q: Financial projections for a Start Up Company (baba nyonya restaurant). Thank you ;)

A: You'll need a few important papers to create financial projections for startups: a balance sheet, an…

Q: A 5-year project will require an investment of $100 million. This comprises of plant and  machinery…

A: Note: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question…

Q: A black box has a total of 10 balls sitting inside. One ball is labeled $100. Two balls are labeled…

A: Given: Label of ball 100 200 300

Q: The readings for module 3 explain that past performance for a company or stock is not a guarantee of…

A: The earnings of a company are most basic measure of a stock's worth. Since you're buying a portion…

Q: Dave deposited P4,000, P4,500 and P5,000 at the end of the 2nd year, 3rd year and 4th year,…

A: Interest rate = 0.1 Year Deposit 2 4000 3 4500 4 5000

Q: What is the incremental profit? To get a rough project's profitability, what is the project's…

A: Profit represents the economic benefit realized when income from a business activity exceeds the…

Q: 5. Given: First cost = $1,000,000 Salvage value after 5 years = $400,000 N= 7 year life Annual O&M…

A: Solution : Under CCA Rate of Deprecation Deprecation on assets will be charge in first year of…

Q: Determine the finance charge, new balance, and minimum payment required for each of the next two…

A: Finance charges refers to those costs or extra amount which is paid by the borrower to the lender on…

Q: 35. A man wishes to bequeath to his daughter P20,000 ten years from now. What amount should he…

A: The present value function can be applied to calculate the investment required today

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.