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revenue of OMR 20,000 per year for five years. You estimate manufacturing costs at 40 percent of revenues. The equipment depreciates using straight-line depreciation over
revenue of OMR 20,000 per year for five years. You estimate manufacturing costs at 40 percent of revenues. The equipment depreciates using straight-line depreciation over five years. The corporate tax rate is 15 percent and the cost of capital is 9 percent. Calculate the NPV of the project. 3 On January 1, 2014, Rusty Inc. decides to invest in 10,000 shares of Safari stock when the stock is selling for OR 15 per share. On July 15, 2014, Safari declares OR 0.50 per share cash dividend to stockholders of record on July 22, 2014, to be paid on August 1, 2014. on December 31, 2014 Safari reports net income of OR 80,000 for 2014. Assume Safari has 25,000 shares of voting stock outstanding during 2014. Requirements 1. Identify what type of investment the Safari stock is for Rusty 2. Journalize the transactions related to Rusty's investment in Safari stock during 2014 revenue of OMR 20,000 per year for five years. You estimate manufacturing costs at 40 percent of revenues. The equipment depreciates using straight-line depreciation over five years. The corporate tax rate is 15 percent and the cost of capital is 9 percent. Calculate the NPV of the project. 3 On January 1, 2014, Rusty Inc. decides to invest in 10,000 shares of Safari stock when the stock is selling for OR 15 per share. On July 15, 2014, Safari declares OR 0.50 per share cash dividend to stockholders of record on July 22, 2014, to be paid on August 1, 2014. on December 31, 2014 Safari reports net income of OR 80,000 for 2014. Assume Safari has 25,000 shares of voting stock outstanding during 2014. Requirements 1. Identify what type of investment the Safari stock is for Rusty 2. Journalize the transactions related to Rusty's investment in Safari stock during 2014
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