If capital is rationed, divisible invest index when determining the optimum investment schedule D Government restrictions on bank lending are associated with hard capital rationing An investment project has a cost of $12,000, payable at the start of the first year 0 75 A company has 31 December as its accounting year-end. On 1 January 20X5, a new machine costing $2,000,000 is purchased. The company expects to sell the machine on 31 December 20X6 for $350,000. The rate of corporation tax for the company is 30%. Tax-allowable depreciation is obtained at 25% on the reducing balance basis, and a balancing allowance is available on disposal of the asset. The company makes sufficient profits to obtain relief for tax-allowable depreciation as soon as they arise. If the company's cost of capital is 15% per annum, what is the present value of the tax savings from the tax-allowable depreciation at 1 January 20X5 (to the nearest thousand dollars)? $391,000 B $248,000 $263,000 D $ 719,000 76 operation. The nossible futur FM: FINANCIAL MANAGEMENT 13 Which TWO of the following are 'efficiency' targets that a not for profit organisation might put in place? A Reduction of wastage of paper B Pay rates for staff of appropriate levels of qualification Staff utilisation D Customer satisfaction ratings 14 Managerial reward schemes should help ensure managers take decisions that are consistent with the objectives of shareholders. Which THREE of the following are characteristics of a carefully designed remuneration package? Linking of rewards to changes in shareholder wealth B Matching of managers' time horizons to shareholders' time horizons Possibility of manipulation by managers D Encouragement for managers to adopt the same attitudes to risk as shareholders E Motivational to primarily achieve short-term goals 15 Indica