Question
Hello, you have answered these type of questions previously for me, would you be able to answer the following 3 questions? (Please see attachment for
Hello, you have answered these type of questions previously for me, would you be able to answer the following 3 questions? (Please see attachment for easier viewing of the questions)
Q1
Maxwell Software, Inc., has the following mutually exclusive projects. |
Year |
| Project A |
| Project B |
0 |
| ?$25,000 |
| ?$28,000 |
1 |
| 14,500 |
| 15,500 |
2 |
| 11,000 |
| 12,000 |
3 |
| 3,400 |
| 11,000 |
a1. | Calculate the payback period for each project. (Do not round intermediate calculations and round your answers to 3 decimal places, e.g., 32.161.) |
| Payback period |
Project A | years |
Project B | years |
Q2:
Down Under Boomerang, Inc., is considering a new three-year expansion project that requires an initial fixed asset investment of $2.61 million. The fixed asset will be depreciated straight-line to zero over its three-year tax life, after which it will be worthless. The project is estimated to generate $2,050,000 in annual sales, with costs of $745,000. The tax rate is 30 percent and the required return is 15 percent. |
What is the project?s NPV? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) |
NPV | $ |
Q3:
Down Under Boomerang, Inc., is considering a new three-year expansion project that requires an initial fixed asset investment of $2.91 million. The fixed asset will be depreciated straight-line to zero over its three-year tax life. The project is estimated to generate $2,150,000 in annual sales, with costs of $845,000. The tax rate is 30 percent and the required return is 11 percent. The project requires an initial investment in net working capital of $370,000, and the fixed asset will have a market value of $245,000 at the end of the project. |
What is the project's Year 0 net cash flow? Year 1? Year 2? Year 3? (Do not round intermediate calculations. A negative answer should be indicated by a minus sign.) |
Years | Cash Flow |
Year 0 | $ |
Year 1 | $ |
Year 2 | $ |
Year 3 | $ |
What is the NPV? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) |
NPV | $ |
Q1 Maxwell Software, Inc., has the following mutually exclusive projects. Year 0 1 2 3 Project A -$25,000 Project B -$28,000 14,500 11,000 3,400 15,500 12,000 11,000 a1. Calculate the payback period for each project. (Do not round intermediate calculations and round your answers to 3 decimal places, e.g., 32.161.) Project A Payback period years years Project B Q2: Down Under Boomerang, Inc., is considering a new three-year expansion project that requires an initial fixed asset investment of $2.61 million. The fixed asset will be depreciated straight-line to zero over its three-year tax life, after which it will be worthless. The project is estimated to generate $2,050,000 in annual sales, with costs of $745,000. The tax rate is 30 percent and the required return is 15 percent. What is the project's NPV? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) NPV $ Q3: Down Under Boomerang, Inc., is considering a new three-year expansion project that requires an initial fixed asset investment of $2.91 million. The fixed asset will be depreciated straight-line to zero over its three-year tax life. The project is estimated to generate $2,150,000 in annual sales, with costs of $845,000. The tax rate is 30 percent and the required return is 11 percent. The project requires an initial investment in net working capital of $370,000, and the fixed asset will have a market value of $245,000 at the end of the project. What is the project's Year 0 net cash flow? Year 1? Year 2? Year 3? (Do not round intermediate calculations. A negative answer should be indicated by a minus sign.) Years Year 0 Cash Flow $ $ Year 1 $ Year 2 $ Year 3 What is the NPV? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) NPV $
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