Sully's Marketing Agency is interested in acquiring one of its competitors for $1,800,000 (initial capital investmen expected that purchasing the competitor would bring in $600,000 annually in cast inflows, and the operating and maintenance costs required annually totai $100,000. Because the companies would share some synergies, it is expected that Sully's Marketing gency could reduce its emplayee workforce by $100,000. What is the Cash Payback Period for-the investment? (1) What is the expected net annual cash flows? (1 mark) (2.) What is the cash payback petiod? (1 mark) Fil in the tlank: ncome differs from actual net income as this type of incor for irregular revenues, expenses, gains, and losses included in this year's net income, It helps them derive of future earnings without the 'noise' of irregular ltems. Salman Khan retired from acting and now owns a textiles business. He is cor to expand his production capabilities. Below are the cash flow information for both Factory A and Factory B. He is : he should purchase. He has asked that your analysis take into account a 5 -year time frame. In this of annual steady cash flows at 10% is 4.55. He is assuming at the end of 5 years, he will sell off the factor of the factories have to be accounted for in your analysis. Information on the cash flows of both factories are below: He has asked you what the NPV is for each factory, and which factory he sho What is the correct recommendation, based on the numbers alone? Select one: a. NPV Factory A=$92,414 and NPV Factory B=$45,814. Salman Khar b. NPV Factory A=$82,100 and NPV Factory B=$36,500. Salman Khar c. NPV Factory A=$68,232 and NPV Factory B=$50,600. Salman Khan d. NPV Factory A=$22,867 and NPV Factory B=$98,152. Salman Khar As the winner of a social media contest, you can choose one of the following prizes: Prize A - $100,000 today Price B - $130,000 at the end of 3 years If the interest rate is 12%, which is the most valuable prize? Select one: a. They are of equal value. b. Prize A, because the NPV of Prize B is less than Prize A c. Prize B, because the NPV of Prize B is greater than Prize A Sully's Marketing Agency is interested in acquiring one of its competitors for $1,800,000 (initial capital investmen expected that purchasing the competitor would bring in $600,000 annually in cast inflows, and the operating and maintenance costs required annually totai $100,000. Because the companies would share some synergies, it is expected that Sully's Marketing gency could reduce its emplayee workforce by $100,000. What is the Cash Payback Period for-the investment? (1) What is the expected net annual cash flows? (1 mark) (2.) What is the cash payback petiod? (1 mark) Fil in the tlank: ncome differs from actual net income as this type of incor for irregular revenues, expenses, gains, and losses included in this year's net income, It helps them derive of future earnings without the 'noise' of irregular ltems. Salman Khan retired from acting and now owns a textiles business. He is cor to expand his production capabilities. Below are the cash flow information for both Factory A and Factory B. He is : he should purchase. He has asked that your analysis take into account a 5 -year time frame. In this of annual steady cash flows at 10% is 4.55. He is assuming at the end of 5 years, he will sell off the factor of the factories have to be accounted for in your analysis. Information on the cash flows of both factories are below: He has asked you what the NPV is for each factory, and which factory he sho What is the correct recommendation, based on the numbers alone? Select one: a. NPV Factory A=$92,414 and NPV Factory B=$45,814. Salman Khar b. NPV Factory A=$82,100 and NPV Factory B=$36,500. Salman Khar c. NPV Factory A=$68,232 and NPV Factory B=$50,600. Salman Khan d. NPV Factory A=$22,867 and NPV Factory B=$98,152. Salman Khar As the winner of a social media contest, you can choose one of the following prizes: Prize A - $100,000 today Price B - $130,000 at the end of 3 years If the interest rate is 12%, which is the most valuable prize? Select one: a. They are of equal value. b. Prize A, because the NPV of Prize B is less than Prize A c. Prize B, because the NPV of Prize B is greater than Prize A
