1. Pelvis International is considering purchasing robotic equipment using the following estimates:

Cost of robotics $4,000,000

Useful life 10 years

Annual Net Cash flows $900,000

The desired Rate of Return is 12%. Use the PVA table from Exhibit 5 on page 573 to estimate the NPV of the equipment.

A) $1,850,000

B) $1,530,500

C) $1,004,000

D) $1,085,000

2. JoJo Starbuck, Inc reports the following:

Net Income $562,000

Preferred Dividends 50,000

Shares of common outstanding 80,000

Market price per share $32.00

What is a) the EPS per common share and b) the price-earnings ratio (rounded to 1 decimal place), respectively?

A) $7.03 and 4.6

B) $6.40 and 5.0

C) $11.24 and 8.1

D) $12.44 and 8.8

3. A project is estimated to cost $524,860 and provide annual net cash flows of $115,000 for 7 years. Determine the internal rate of return for this project, using the Present Value of an Annuity table from Exhibit 5 on page 573 of your textbook. (managerial accounting)

A) 7%

B) 11.8%

C) 12.0%

D) 12.3%