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pls solve usings the numbers provided Blue Llama Mining is considering an investment that will have the following sales, variable costs, and fixed operating costs:
pls solve usings the numbers provided
Blue Llama Mining is considering an investment that will have the following sales, variable costs, and fixed operating costs: This project will require an investment of 525,000 in new equipment. The equipment will have no salvage value at the end of the project's four-year life. Blue Llama Mining pays a constant tax rate of 40%, and it has a required rate of return of 11%. When using acceierated depreciation, the project's net present value (NPV) is When using straight-line depreciation, the project's NPV is Using the depreciation mechod will result in the greater NPV for the project: No other firm would take on this project if Blue Uama Mining turns it down. How much should Blue Llama Mining reduce the NPV of this project if it dincovered that this project would reduce one of its division's net after-tax cash flows by $400 for each year of the four-year project? 51,241 $1,365 $1,055 3745 The project will require an inidial investment of $25,000, but the project will also be using a company-owned truci that is not currently being used. This truck could be soid for $9,000, after taxes, if the project is rejected. What should Blue Llama Mining do to take this information into account? The company does not need to do anything with the value of the truck because the truck is a sunk cost. Increase the wiv of the project by 59,000 . tncrease the amount of the Initial investment by $9;000 Step by Step Solution
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