Acume that you are thinking about starting your own small business. You have made the following estimates regarding this opportunity . You can rent a location for your business at a cost of $36.000 per year . The equipment costs incurred to start the business would total $250,000 The equipment would have a 5 year useful life and a salvage value of $25.000 Your company's estimated sales per year would equal $350,000 and its variable cost of goods sold would be 30% of sales Other operating costs would include $14.000 per year in salaries $4.000 per year for Insurance, $25.000 per year for titties, and a sales commission The sample rate of return for this investment opportunity is closest to Minipe choler COIB MC Qu. 12-57 (Algo) Assume that a company is considering... Assume that a company is considering a capital westment project with a four year time horizon and the following cashow Cost of new equipment $ 210,000 working capital required 550.000 Annual net cash inflows $100,000 Maintenance and repairs in third year $ 40,000 Salvage value of equipment in fourth year $ 35,000 Click here to view Exhibit 120.1 and Exhibit 120.2. to determine the appropriate discount factors using the tobles provided The working capital will be released at the end of the project and the company's required rate of return is 15%. The net present value of the project is closest 10 Multiple Choice O 5:24.2001 554400 $2.500 COTB MC Qu. 12-63 (Algo) Assume that you are thinking about.. Assume that you are thinking about starting your own small business. You have made the following estimates regarding this opportunity . You can rent a location for your business to cost of $36000 per year The equipment costs incurred to start the business would total $250.000 The equipmont would have a 5 year useful and a sige value of $25.000 . Your company's estimated sales per yer would equal $350.000 and its variable cost of goods sold would be 30% of sales Other operating costs would include $74.000 per year in one $4.000 per year for surance 525,000 per year for thes, and a common The simple rate of return for this investment oportuny is closest to Map Choice 202 144 COTB MC Qu. 12-57 (Algo) Assume that a company is considering... Assume that a company is considering a capital investment project with a four yeat time horizon and the following cohows cost of new equipment $ 210,000 Working capital required $ 50,000 Annual net cash inflows $100,000 Maintenance and repairs In third year $10,000 Salvace value of equipment in fourth year $15.000 Click here to view Ext 120.1 and Ext. 122-2. to determine the appropriate discount factors) using the tables poned The working capital we be released at the end of the project and the company's required fate of returns 18%. The net present Value of the project is done to $24.2001 S54400
