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Part 1: Assume ABC Company has asked you to prepare their 20X1 year-end Balance Sheet based upon the below information. End of the year information:
Part 1: Assume ABC Company has asked you to prepare their 20X1 year-end Balance Sheet based upon the below information. End of the year information: Account Cash Accounts Receivable Inventory Equipment Accumulated Depreciation Accounts Payable Short-term Notes Payable Long-term Notes Payable Common Stock Retained Earnings Purchase Price Required Rate of Return Time Period Cash Flows-Year 1 Cash Flows-Year 2 Cash Flows-Year 3 Cash Flows-Year 4 Cash Flows-Year 5 N/A Project I $80,000 N/A 6% 3 years $48,000 $36,000 $22,000 12/31/X1 Ending Balance Part 2: ABC Company's management is also considering 3 new projects consisting of the purchase of new equipment. The company has limited resources and may not be able to complete/make all 3 purchases. Therefore, calculate the NPV for each, and place the projects in the order in which they should be completed using NPV as the reasoning. The information is as follows for the purchases below. 50,000 175,000 126,000 480,000 5 years $85,000 90,000 156,000 12,000 200,000 Project 2 $175,000 235,000 solve $74,000 $38,000 $26.800 $19,000 Project 3 $22,700 125 2 years $13,000 $13,000 N/A N/A N/A
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