Chapter 12 Foundational 15 1 Required information. Saved Part 1 of 15 0.83 points eBook The Foundational 15 (Algo) [LO12-1, LO12-2, LO12-3, LO12-5, LO12-6] [The following information applies to the questions displayed below) Cardinal Company is considering a five-year project that would require a $2,955,000 investment in equipment with a useful life of five years and no salvage value. The company's discount rate is 16%. The project would provide net operating income in each of five years as follows: Sales Variable expenses Fixed expenses: Contribution margin Advertising, salaries, and other fixed out- $ 753,000 591,000 of-pocket costs Depreciation Total fixed expenses $2,871,000 1,018,000 1,853,000 1,344,000 Print Net operating income References $ 509,000 Click here to view Exhibit 12B-1 and Exhibit 128-2. to determine the appropriate discount factor(s) using table. Foundational 12-1 (Algo) Required: 1. Which item(s) in the income statement shown above will not affect cash flows? (You may select more than one answer. Single cli the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark t empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.) Sales 7 Variable expenses 7 Advertising, salaries, and other fixed out-of-pocket costs expenses, 7 Depreciation expense Chapter 12 Foundational 15 2 Saved Part 2 of 15 0.83 points eBook Required information The Foundational 15 (Algo) [LO12-1, LO12-2, LO12-3, LO12-5, LO12-6] [The following information applies to the questions displayed below] Cardinal Company is considering a five-year project that would require a $2,955,000 investment in equipment with a useful life of five years and no salvage value. The company's discount rate is 16%. The project would provide net operating income in each of five years as follows Sales Variable expenses Print References $2,871,000 Contribution margin 1,018,000 1,853,000 Fixed expenses: Advertising, salaries, and other fixed out- of-pocket costs $ 753,000 Depreciation 591,000 Total fixed expenses 1,344,000 $ 509,000 Net operating income Click here to view Exhibit 12B-1 and Exhibit 128-2. to determine the appropriate discount factor(s) using table. Foundational 12-2 (Algo) 2. What are the project's annual net cash inflows? Annual net cash inflow Chapter 12 Foundational 15 3 Required information Saved Part 3 of 15 083 points eBook Print References The Foundational 15 (Algo) [LO12-1, LO12-2, LO12-3, LO12-5, LO12-6] [The following information applies to the questions displayed below] Cardinal Company is considering a five-year project that would require a $2,955,000 investment in equipment with a useful life of five years and no salvage value. The company's discount rate is 16%. The project would provide net operating income in each of five years as follows: Sales Variable expenses Fixed expenses: of-pocket costs $2,871,000 1,018,000 1,853,000 Contribution margin Advertising, salaries, and other fixed out- $ 753,000 591,000 1,344,000 $500,000 Depreciation Total fixed expenses Net operating Incone Click here to view Exhibit 128-1 and Exhibit 128-2. to determine the appropriate discount factor(s) using table. Foundational 12-3 (Algo) 3. What is the present value of the project's annual net cash inflows? (Round your final answer to the nearest whole dollar amoun Present value Chapter 12 Foundational 15 4 1 Required information. Saved Part 4 of 151 0.83 points eflook The Foundational 15 (Algo) [LO12-1, LO12-2, LO12-3, LO12-5, LO12-6] [The following information applies to the questions displayed below] Cardinal Company is considering a five-year project that would require a $2,955,000 investment in equipment with a useful life of five years and no salvage value. The company's discount rate is 16%. The project would provide net operating income in each of five years as follows: Sales Variable expenses $2,871,000 1,018,000 1,853,000 Print References Contribution margin Fixed expenses: Advertising, salaries, and other fixed out $ 753,000 591,000 of-pocket costs Depreciation Total fixed expenses Net operating Income 1,344,000 $ 509,000 Click here to view Exhibit 12B-1 and Exhibit 12B-2, to determine the appropriate discount factor(s) using table. Foundational 12-4 (Algo) 4. What is the project's net present value? (Round final answer to the nearest whole dollar amount.) Net present value Chapter 12 Foundational 15 5 Saved Part 5 of 15 0.83 points eBook Required information The Foundational 15 (Algo) [LO12-1, LO12-2, LO12-3, LO12-5, LO12-6] [The following information applies to the questions displayed below.] Cardinal Company is considering a five-year project that would require a $2,955,000 investment in equipment with a useful life of five years and no salvage value. The company's discount rate is 16%. The project would provide net operating income in each of five years as follows: Sales Variable expenses $2,871,000 1,018,000 1,853,000 Print References of-pocket costs Contribution margin Fixed expenses: Advertising, salaries, and other fixed out- $ 753,000 591,000 1,344,000 $ 509,000 Depreciation Total fixed expenses Net operating income Click here to view Exhibit 12B-1 and Exhibit 12B-2, to determine the appropriate discount factor(s) using table. Foundational 12-5 (Algo) 5. What is the profitability index for this project? (Round your answer to 2 decimal places.) Profitability index Chapter 12 Foundational 15 6 Required information Saved Part 6 of 15 083 points eBook Print References The Foundational 15 (Algo) [LO12-1, LO12-2, LO12-3, LO12-5, LO12-6) [The following information applies to the questions displayed below] Cardinal Company is considering a five-year project that would require a $2,955,000 investment in equipment with a useful life of five years and no salvage value. The company's discount rate is 16%. The project would provide net operating income in each of five years as follows: Sales Variable expenses Fixed expenses: Contribution margin i $2,871,000 1,016,000 1,853,000 Advertising, salaries, and other fixed out- of pocket costs $ 753,000 591,000 1,344,000 $500,000 Depreciation: Total fixed expenses Net operating income Click here to view Exhibit 128-1 and Exhibit 128-2, to determine the appropriate discount factor(s) using table. Foundational 12-6 (Algo) 6. What is the project's internal rate of return? Project's internal rate of return % Chapter 12 Foundational 15 7 Saved Part 7 of 15 0.83 points Required information The Foundational 15 (Algo) [LO12-1, LO12-2, LO12-3, LO12-5, LO12-6] [The following information applies to the questions displayed below] Cardinal Company is considering a five-year project that would require a $2,955,000 investment in equipment with a useful life of five years and no salvage value. The company's discount rate is 16%. The project would provide net operating income in each of five years as follows Sales Variable expenses $2,871,000 1,018,000 1,853,000 eBook Contribution margin Fixed expenses: Advertising, salaries, and other fixed out- $ 753,000 591,000 1,344,000 $ 509,000 Print References of-pocket costs Depreciation Total fixed expenses Net operating income Click here to view Exhibit 12B-1 and Exhibit 128-2. to determine the appropriate discount factor(s) using table. Foundational 12-7 (Algo) 7. What is the project's payback period? (Round your answer to 2 decimal places.) Project's payback period years Chapter 12 Foundational 15 8 00 Required information Saved Part of 15 0.83 points eBook The Foundational 15 (Algo) [LO12-1, LO12-2, LO12-3, LO12-5, LO12-6] [The following information applies to the questions displayed below] Cardinal Company is considering a five-year project that would require a $2.955,000 investment in equipment with a useful life of five years and no salvage value. The company's discount rate is 16%. The project would provide net operating income in each of five years as follows: Sales Variable expenses $2,871,000 1,018,000 1,853,000 Print References Contribution margin Fixed expenses: Advertising, salaries, and other fixed out- $ 753,000 591,000 of-pocket costs Depreciation Total fixed expenses Net operating income 1,344,000 $ 509,000 Click here to view Exhibit 12B-1 and Exhibit 128-2, to determine the appropriate discount factor(s) using table. Foundational 12-8 (Algo) 8. What is the project's simple rate of return for each of the five years? (Round your answer to 2 decimal places.) Simple rate of retum % Chapter 12 Foundational 15 13 Saved Part 13 of 15 0.83 points eBook Print References Required information. The Foundational 15 (Algo) [LO12-1, LO12-2, LO12-3, LO12-5, LO12-6] [The following information applies to the questions displayed below] Cardinal Company is considering a five-year project that would require a $2,955,000 investment in equipment with a useful life of five years and no salvage value. The company's discount rate is 16%. The project would provide net operating income in each of five years as follows: Sales Variable expenses Contribution margin Fixed expenses: Advertising, salaries, and other fixed out- $ 753,000 591,000 of-pocket costs Depreciation Total fixed expenses Net operating income $2,871,000 1,018,000 1,853,000 1,344,000 $ 500,000 Click here to view Exhibit 128-1 and Exhibit 128-2. to determine the appropriate discount factor(s) using table. Foundational 12-13 (Algo) 13. Assume a postaudit showed that all estimates (including total sales) were exactly correct except for the variable expense ratio, which actually turned out to be 45% What was the project's actual net present value? (Negative amount should be indicated by a minus sign. Round intermediate calculations and final answer to the nearest whole dollar amount.) Net present value Chapter 12 Foundational 15 14 Part 14 of 15 0.83 points Required information. Saved The Foundational 15 (Algo) [LO12-1, LO12-2, LO12-3, LO12-5, LO12-6] [The following information applies to the questions displayed below.] Cardinal Company is considering a five-year project that would require a $2,955,000 investment in equipment with a useful life of five years and no salvage value. The company's discount rate is 16%. The project would provide net operating income in each of five years as follows: Sales $2,871,000 1,018,000 1,853,000 Variable expenses eBook Contribution margin Fixed expenses: Advertising, salaries, and other fixed out- $ 753,000 591,000 Print References of-pocket costs Depreciation Total fixed expenses Net operating incone 1,344,000 $ 509,000 Click here to view Exhibit 128-1 and Exhibit 12B-2. to determine the appropriate discount factor(s) using table. Foundational 12-14 (Algo) 14. Assume a postaudit showed that all estimates (including total sales) were exactly correct except for the variable expense ratio, which actually turned out to be 45% What was the project's actual payback period? (Round your answer to 2 decimal places.) Payback period years Chapter 12 Foundational 15 15 Required information Saved Part 15 of 15 0.88 points eBook Print References The Foundational 15 (Algo) [LO12-1, LO12-2, LO12-3, LO12-5, LO12-6] [The following information applies to the questions displayed below.] Cardinal Company is considering a five-year project that would require a $2.955,000 investment in equipment with a useful life of five years and no salvage value. The company's discount rate is 16%. The project would provide net operating income in each of five years as follows: Sales Variable expenses Contribution margin Fixed expenses: Advertising, salaries, and other fixed out- $ 753,000 591,000 of-pocket costs Depreciation Total fixed expenses Net operating income $2,871,000 1,018,000 1,853,000 1,344,000 $ 509,000 Click here to view Exhibit 12B-1 and Exhibit 12B-2. to determine the appropriate discount factor(s) using table. Foundational 12-15 (Algo) 15. Assume a postaudit showed that all estimates (including total sales) were exactly correct except for the variable expense ratio, which actually turned out to be 45%. What was the project's actual simple rate of return? (Round your answer to 2 decimal places. Simple rate of return %