An investment that costs $50,000 will return $15,000 operating cash flows per year for five years. Determine
Question:
An investment that costs $50,000 will return $15,000 operating cash flows per year for five years. Determine the net present value of the investment if the required rate of return is 14 percent. Should the investment be undertaken? (Your answer might be slightly different due to rounding. Select the best answer from those available.)
A. Yes, the profit is $25,000.
B. No, the accounting return is less than 14%.
C. No, the net present value is negative at $11,045.
D. Yes, the net present value is positive at $1,496.50.
What is NPV? The net present value is an important tool for capital budgeting decision to assess that an investment in a project is worthwhile or not? The net present value of a project is calculated before taking up the investment decision at...
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 76% (13 reviews)
D Yes the net present value is posi...View the full answer
Answered By
Ashington Waweru
I am a lecturer, research writer and also a qualified financial analyst and accountant. I am qualified and articulate in many disciplines including English, Accounting, Finance, Quantitative spreadsheet analysis, Economics, and Statistics. I am an expert with sixteen years of experience in online industry-related work. I have a master's in business administration and a bachelor’s degree in education, accounting, and economics options.
I am a writer and proofreading expert with sixteen years of experience in online writing, proofreading, and text editing. I have vast knowledge and experience in writing techniques and styles such as APA, ASA, MLA, Chicago, Turabian, IEEE, and many others.
I am also an online blogger and research writer with sixteen years of writing and proofreading articles and reports. I have written many scripts and articles for blogs, and I also specialize in search engine
I have sixteen years of experience in Excel data entry, Excel data analysis, R-studio quantitative analysis, SPSS quantitative analysis, research writing, and proofreading articles and reports. I will deliver the highest quality online and offline Excel, R, SPSS, and other spreadsheet solutions within your operational deadlines. I have also compiled many original Excel quantitative and text spreadsheets which solve client’s problems in my research writing career.
I have extensive enterprise resource planning accounting, financial modeling, financial reporting, and company analysis: customer relationship management, enterprise resource planning, financial accounting projects, and corporate finance.
I am articulate in psychology, engineering, nursing, counseling, project management, accounting, finance, quantitative spreadsheet analysis, statistical and economic analysis, among many other industry fields and academic disciplines. I work to solve problems and provide accurate and credible solutions and research reports in all industries in the global economy.
I have taught and conducted masters and Ph.D. thesis research for specialists in Quantitative finance, Financial Accounting, Actuarial science, Macroeconomics, Microeconomics, Risk Management, Managerial Economics, Engineering Economics, Financial economics, Taxation and many other disciplines including water engineering, psychology, e-commerce, mechanical engineering, leadership and many others.
I have developed many courses on online websites like Teachable and Thinkific. I also developed an accounting reporting automation software project for Utafiti sacco located at ILRI Uthiru Kenya when I was working there in year 2001.
I am a mature, self-motivated worker who delivers high-quality, on-time reports which solve client’s problems accurately.
I have written many academic and professional industry research papers and tutored many clients from college to university undergraduate, master's and Ph.D. students, and corporate professionals. I anticipate your hiring me.
I know I will deliver the highest quality work you will find anywhere to award me your project work. Please note that I am looking for a long-term work relationship with you. I look forward to you delivering the best service to you.
3.00+
2+ Reviews
10+ Question Solved
Related Book For
Managerial Accounting for Managers
ISBN: 978-1259578540
4th edition
Authors: Eric Noreen, Peter Brewer, Ray Garrison
Question Posted:
Students also viewed these Managerial Accounting questions
-
If the firms required rate of return is 14 percent, what is the net present value of the following project? Year Cash Flow 0 .......... $(75,000) 1 .......... 50,000 2 .......... 40,000
-
If the expected net present value of returns from an investment project is $50,000, what is the maximum price that a risk-neutral investor would pay for it? Explain.
-
A companys sales dropped 10% per year for five years. a. What annual rate of sales growth for the subsequent five years would return the sales to the original level? b. To the nearest month, how long...
-
A lightweight, rigid beam 10.0 m long is supported by a cable attached to a spring of force constant k = 8.25 kN/m as shown in Figure P12.38. When no load is hung on the beam (Fg = 0), the length L...
-
Let F be as in Problem 19. Calculate Where (a) C is the ellipse x2 / 9 + y2 / 4 = 1 (b) C is the square the vertices (1, - 1), (1, 1), (-1, 1), and (-1, -1). (c) C is the triangle with vertices (1,...
-
Getting things done on time and at a reasonable price means employees' attitudes are of secondary importance. T F
-
Do you get to travel much? If so, what do you like or dislike about international travel? LO.1
-
A small hotel in a popular resort area has 20 rooms. The hotel manager estimates that 15% of all confirmed reservations are no-shows. Consequently, the hotel accepts confirmed reservations for as...
-
Hi there; this is just a list of terms that I could just google, but I wanted a sort of different explanation / definition if that's okay. That's all! (They're just Business Law terms) 1. Statute of...
-
A forward contract may be used for which of the following? 1) A fair value hedge of an asset. 2) A cash flow hedge of an asset. 3) A fair value hedge of a liability. 4) A cash flow hedge of a...
-
At an activity level of 6,000 units the cost for maintenance is $7,200 and at 10,000 units the cost for maintenance is $11,600. Using the high-low method, the cost formula for maintenance is: a....
-
Bonnie purchased a new business asset (five-year property) on March 10, 2007, at a cost of $20,000. She also purchased a new business asset (seven-year property) on November 20, 2007, at a cost of...
-
Which of the following is not a common characteristic of a VHWO? a. Typically, no fees or only minimal fees are charged for services that a VHWO provides. b. Resource providers are typically the...
-
20 of 30 Operational, organizational, historical, and custom are all types of need to check on a daily basis as a system administrator. that you'll reporting logging monitoring
-
Consider each of the 3 definitions of "Health" below: 1) "a state of complete physical, mental, and social well-being and not merely the absence of disease or infirmity". (WHO) 2) "the ability to...
-
What is the expected FY24 accounts receivable amount and the net plant & equipment amount? Sales Cost of Goods Sold Other Expenses Depreciation Taxable Income Taxes (21%) Net Income FY23 Income...
-
Using research literature in project management, explain the differences between traditional project management from a tactical and strategic perspective. What are the short-term differences? What...
-
The expected value for a question was: E(X) = ( 1 / t h e t a ) ( ( e 5 6 ) / ( and 5 1 ) ) Using the E(X) above, comapre this expected value with the expected value of the Expo(theta) distribution,...
-
Recording spoiled goods. During the month of November 19X6, the following events involving losses from spoilage took place at the Lombardo Tool Company. On November 8 the control mechanism on an...
-
For liquid water the isothermal compressibility is given by; where r and b are functions of temperature only. If 1 kg of water is compressed isothermally and reversibly from I to 500 bar at 60(C. how...
-
Give three examples of asymmetric information in which the health consumer has information that is unavailable to the health provider. Give three concrete examples in which the health provider has...
-
On July 12, Reliable Repair Service extended an offer of $150,000 for land that had been priced for sale at $185,000. On September 3, Reliable Repair Service accepted the sellers counteroffer of...
-
On July 12, Reliable Repair Service extended an offer of $150,000 for land that had been priced for sale at $185,000. On September 3, Reliable Repair Service accepted the sellers counteroffer of...
-
On July 12, Reliable Repair Service extended an offer of $150,000 for land that had been priced for sale at $185,000. On September 3, Reliable Repair Service accepted the sellers counteroffer of...
-
Your company BMG Inc. has to liquidate some equipment that is being replaced. The originally cost of the equipment is $120,000. The firm has deprecated 65% of the original cost. The salvage value of...
-
1. What are the steps that the company has to do in time of merger transaction? And What are the obstacle that may lead to merger failure? 2.What are the Exceptions to not to consolidate the...
-
Problem 12-22 Net Present Value Analysis [LO12-2] The Sweetwater Candy Company would like to buy a new machine that would automatically "dip" chocolates. The dipping operation currently is done...
Study smarter with the SolutionInn App