Keller Construction is considering two new investments. Project E calls for the purchase of earthmoving equipment. Project H represents an investment in a hydraulic lift. Keller wishes to use a net present value profile in comparing the projects. The investment and cash flow patterns are as follows:

Project E Project H
($30,000 Investment) ($28,000 Investment)
Year Cash Flow Year Cash Flow
1 $8,000 1 $17,000
2 11,000 2 12,000
3 12,000 3 10,000
4 15,000

Required:
a. Determine the net present value of the projects based on a zero percent discount rate.
b. Determine the net present value of the projects based on a discount rate of 11 percent.

Answers

Answer 1

a. The net present value of project E based on a 0% discount rate is $16,000

The net present value of project H based on an 11% discount rate is $11,000

b. The net present value of project E based on a 0% discount rate is  $4,790.32

The net present value of project H based on an 11% discount rate is $4,366.70

Net present value is the present value of after-tax cash flows from an investment less the amount invested.  

Only projects with a positive NPV should be accepted. A project with a negative NPV should not be chosen because it isn't profitable.  

When choosing between positive NPV projects, choose the project with the highest NPV first because it is the most profitable.

NPV can be calculated using a financial calculator

Project E

Cash flow in year 0 = -30,000

Cash flow in year 1 = $8,000

Cash flow in year 2 = $11,000

Cash flow in year 3 = $12,000

Cash flow in year 4 = $15,000

NPV when I is 0% = $16,000

NPV when I is 11% = $4,366.70

Project H

Cash flow in year 0 = $-28,000

Cash flow in year 1 = $17,000

Cash flow in year 2 = $12,000

Cash flow in year 3 = $10,000

NPV when I is 0% = $11,000

NPV when I is 11% = $4,366.70

To determine NPV using a financial calculator take the following steps:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. after inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.  

3. Press compute  

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Related Questions

Which of the following is not a component of internal control?
A
Integration
B
Control activities
С
Control environment.
D
Risk assessment

Answers

Answer:

D is not component of internal control

Internal control is implemented to improve the integrity of economic and accounting information within the organization. Risk assessment is not a component of internal control. Therefore, D is the correct option.

What is risk assessment?

Risk assessment is a method to identify the risks and challenges which can hamper the project or goal of the organization. The process includes some steps, such as identifying the risk, evaluating it, managing it, recording the findings, and reviewing the controls. There are many types of risk assessment. They are qualitative, quantitative, generic, site-specific, and dynamic risk assessments.

The purpose of risk assessment is to create and maintain health and safety conditions within the organization.

Internal control is implemented to improve the integrity of economic and accounting information within the organization. Risk assessment is not a component of internal control. Therefore, D is the correct option.

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When marginal cost is greater than average cost, average cost must be:_________.
a. rising.
b. falling.
c. constant.
d. The direction of change in marginal cost cannot be determined from this information.

Answers

Answer:

A

The average cost will be rising

According to Bradly, Pratt, Byrd, and Simmons, enterprise architecture strategically positions an organization to leverage its current IT capabilities and also provides a dynamic roadmap to the future.
a. true
b. false

Answers

The answer is A, "TRUE"

Marvin Industries owns a piece of equipment with a cost of $78,000 and accumulated depreciation of $51,000. The equipment is sold for $30,000 cash. The amount that should be reported as a cash inflow from investing activities is:

Answers

Explanation:

tu pregunta no tiene sentido y no entiendo ese idioma

A research study showed that adolescents who watched more than 4 hours of TV per day were more than five times as likely to start smoking as those who watched less than 2 hours a day. The researchers speculate that TV actors’ portrayals of smoking as personally and socially rewarding were an effective indirect method of tobacco promotion.

List the factors that you think cause adolescents to start smoking. (You may select more than one answer. Click the box with a check mark for the correct answer and double click to empty the box for the wrong answer.)

Curiosity
Parents who smoke
Friends who smoke
Seeing teenagers smoke in movies and TV
Boredom
Wanting to look cool
School health classes explaining the harmful effects of smoking\
High cigarette sales taxes

Answers

Answer:

peer pressure

Explanation:

when your friend is convincing u in doing some thing wrong

Curiosity, Friends who smoke, Seeing teenagers smoke in movies and TV and Wanting to look cool are some of the reason of adolescents to start smoking.

What are the cause of smoking?

Cigarette smoking is linked to cancer, heart disease, stroke, lung disease, diabetes, and chronic obstructive pulmonary disease, which includes emphysema and chronic bronchiti.

Tobacco use raises the risk of tuberculosis, some eye illnesses, and immune system problems such as rheumatoid arthritis.

Thus, option A, C, D and F are correct.

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If the economy is in an expansionary period, appropriate policies to pursue may include: Group of answer choices an income tax cut that shifts the AD curve to the right. consumer investment incentives that shift the AD curve to the right business investment incentives that shift the AD curve to the left. a reduction in government spending that shifts the AD curve to the left.

Answers

Answer:

curve to the right business investment incentives

Last year Attic charged $2,334,667 Depreciation on the Income Statement of Andrews. If early this year Attic purchased a new depreciable asset, the effect on Andrews's financial statements would be (all other items remaining equal):

Answers

Answer:

Note: The correct option is a. Increase Net Cash from operations.

Explanation:

Note: This question is not complete as the options are omitted. The options are therefore provided to complete the question before answering the question as follows:

a. Increase Net Cash from operations

b. Decrease Net Cash from operations on the Cash Flow Statement

c. No impact on Net Cash from operations

d. Just impact the Balance Sheet

The explanation of the answers is now provided as follows:

Since the assets was purchased early in the year, depreciation will be charged on it in the income statement for the year at the end of the year. Since depreciation is a non-cash item, it will added back to the net income in the indirect Cash Flow Statement method as one of the adjustments to the net income under the Cash from operations. This adding back of the depreciation will therefore lead to an Increase Net Cash from operations.

Therefore, the correct option is a. Increase Net Cash from operations.

A project has an expected risky cash flow of $500 in year 3. The risk-free rate is 4%, the expected market rate of return is 14%, and the project's beta is 1.20. Calculate the certainty equivalent cash flow for year 3, CEQ3. (Assume CAPM holds.)

Answers

The certainty equivalent cash flow for year 3, CEQ3 is $360.33

The computation of the certainty equivalent cash flow for year 3 is as follows:

But before that, the cost of equity should be determined via using the Capital Asset Pricing Model (CAPM).

Cost of equity = Risk-free rate + beta × (expected market rate of return - risk-free rate)

= 4% + 1.20 × (14% - 4%)

= 16%

Now the certainty equivalent cash flow for year 3 is

= $500 ÷ (1+ 0.16)^3

= $360.33

Therefore we can conclude that the certainty equivalent cash flow for year 3, CEQ3 is $360.33

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Name 2 of the 4 structures a business can have

Answers

Answer:

4 Types of Legal Structures for Business:

   Sole Proprietorship.    General Partnership.    Limited Liability Company (LLC)    Corporations (C-Corp and S-Corp)

If people refused to use banks to create checkable deposits, the banking system would:__________
a) be able to expand the money supply by more than the money multiplier indicates.
b) not be affected in the money creating process.
c) not be able to create new money.
d) not have a way to loan out excess reserves.

Answers

Answer:

The banking system would definitely not be able to to create new money.

The banking system could not print fresh money if individuals refused to use banks to make checkable deposits. As a result, choice (C) is the best way to respond.

What is checkable deposits?

Any demand deposit account that permits the writing of checks or drafts of any sort is referred to technically as having checkable deposits. An account with a demand deposit allows the owner to take money out immediately and without warning.

A negotiable order of withdrawal (NOW) or Super NOW account are examples of a negotiable draft that falls under this category. (Withdrawing money from NOW accounts may need a seven-day written notice; however, this is rarely necessary.)

With a checkable deposit account, the consumer has constant access to cash. There may be a monthly withdrawal restriction on some checkable deposit account types, such as money market accounts.

Hence, option (C) is accurate.

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When changes in prices happen often enough to cause consumers to be confused or angry, businesses are facing a type of cost known as ________.
a. menu costs.
b. coordination cost.
c. shoe leather costs.

Answers

In the case when there is a change in price that occurs and sufficient to cause the consumers to be confused or angry so this cost is known as the menu cost.

The following information is related to the menu cost:

It is to be caused by fluctuation of the price. In this,  the cost of the computer, menu of the price and the printing of the new menu should be involved.

It cannot be other types of cost i.e.

Shoe-leather cost as it because of inflation, also when there is a lower cash flow so the purchasing power should be less.The coordination cost refers to the processing cost that lies between the various organization for business motives.

Therefore we can conclude that In the case when there is a change in price that occurs and sufficient to cause the consumers to be confused or angry so this cost is known as the menu cost.

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Ngân hàng thương mại có tỷ lệ an toàn vốn tối thiểu là 8% và tỷ suất sinh lời trên tài sản có hằng năm như sau : năm 1998 có ROA là 14.3% , năm 1999 có ROA là 17.0% , năm 2000 có ROA là 15.1% , năm 2001 có ROA là 12.2% , năm 2002 có ROA 9.8%, năm 2003 có ROA là 7.5% , năm 2004 có ROA là 13.8% , năm 2005 có ROA là 13.5% , năm 2006 có ROA là 16.3% , năm 2007 có ROA là 15.7% , năm 2008 có ROA là 15.8% , năm 2009 có ROA là 16.0% , năm 2010 có ROA là 14.9% , năm 2011 có ROA là 14.6% , năm 2012 có ROA là 12.4% . yêu cầu : ước lượng chỉ số Z đánh giá nguy cơ phá sản ?

Answers

Answer:

???????

Explanation:

Suppose today you enter a forward contract to buy 1 share of ADM stock in 1 year at a forward price of $30, and today you also buy 1-year Treasury bills with a face value of $30. ADM is not expected to pay a dividend in the next 1 year. Your position has the same payoff in 1 year as:

Answers

"Buying today 1 share of ADM itself" is the appropriate response. A further solution is provided below.

According to the question,

Buy 1 share of ADM stock in time,

= 1 year

Forward price,

= $30

Face value,

= $30

We can say that,

Buying share today will be:

[tex]= Investing \ in \ 1 \ year \ T-bill+Buying \ forward \ contracts[/tex]

Thus the above is the right solution.

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Today, Li has $900,000 (treat this as a cash inflow) in an account that gives an 8% return each year. He has been investing $7,000 a year at the end of each year for 30 years. How much did he have in his account 30 years ago

Answers

Answer:

The present value should be $10,635.116

Explanation:

The computation of the present value is given below:

Interest rate i.e. RATE should be 8%

PMT is $7,000

NPER is 30

FV is $900,000

The formula is given below:

=-PV(RATE,NPER,PMT,FV,TYPE)

After applying the above formula, the present value should be $10,635.116

During year 1 meriwerher construction company started a construction job with a contract price 3,000,000 the job was completed in year 2

Answers

Answer Correct Answer = Option ‘C’ $ 350,000= Gross Profit for Year 2 Working for above answer Working Year 1 end Year 2 End A Contract Price $ 3,000,000

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Ambiance Inc. buys back 3,000 shares of its $10 par value common stock from investors at $45 per share. This stock repurchase would be recorded with a debit to: A. Treasury Stock for $30,000, a debit to Additional Paid-in Capital for $105,000, and a credit to Cash for $135,000. B. Treasury Stock and a credit to Cash for $135,000. C. Cash and a credit to Treasury Stock for $135,000. D. Treasury Stock and a credit to Cash for $30,000.

Answers

jjhhhhbjkkkknjhhhhjjjjjjj

Which of these is true about entrepreneurs? . A. Entrepreneurs are born not made . B. Anyone can start a business . C. Entrepreneurs are gamblers. D. Age is no barrier in entrepreneurship

Answers

Answer:

i think it is D

Explanation:

no matter how old you are one can bring up a new business

In markets where the government imposes an excise tax on unit sales, it also has a tendency to dabble with restrictions on advertising (for example, cigarettes and hard liquor). Do potential (or actual) restrictions on advertising in these markets serve the interest of a government that is interested in maximizing its tax revenue from the sale of these products? Explain your answer

Answers

Answer:

I am sorry I don't know sorry again

Explain why a car is an economic good

Answers

Answer:

car is economic good because it help us to transport goods from one place to another and is can used for travelling from one place to another in a short period of time

An economic good is something that requires resources to produce and has a finite supply. Because the resources and labor used to create a car could have been used to create another good or group of goods, cars are considered economic goods.

What makes a good an economic good?

A good is referred to as an "economic good" if its demand outweighs its supply and it requires human effort to obtain. Free goods, however, like air, are always available and don't require any conscious effort to obtain.

Through the sale and servicing of automobiles, the auto manufacturing industry contributes $1.1 trillion annually to the economy. This money circulates throughout the economy, paying suppliers of auto parts, paying employees at assembly plants, and giving the government money.

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The primary responsibility for establishing and maintaining internal control rests with
А
The controller
В.
The internal auditor
С
The treasurer
D
Management

Answers

Answer:

D

Explanation:

Management is responsible for establishing and maintaining internal control to achieve the objectives of effective and efficient operations, reliable financial reporting, and compliance with applicable laws and regulations.

A controller b authorities

Advantages of the corporate form include all of the following except: A. shares can be purchased in small amounts. B. ownership interests are transferrable. C. easy to raise capital. D. legal liability of its owners is unlimited.

Answers

D. Legal liability of its owners is u limited

Statement that does not describes Advantages of the corporate form is D: legal liability of its owners is unlimited.

A corporation serves as a business set up whereby the legal entity is been separated from  from its owners.

Advantages of this setting is that shares can be purchased in small amounts and it allows transfer of ownership interests and it is very easy to raise capital in this setting.

Therefore, option D is correct.

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QS 8-7 Computing revised depreciation LO C2 On January 1, the Matthews Band pays $65,800 for sound equipment. The band estimates it will use this equipment for four years and after four years it can sell the equipment for $2,000. Matthews Band uses straight-line depreciation but realizes at the start of the second year that this equipment will last only a total of three years. The salvage value is not changed. Compute the revised depreciation for both the second and third years.

Answers

Answer:

$23,925 for both the second and third years

Explanation:

Depreciation is the systemic recognition of the cost of an asset in the profit or loss statement. It is an expense.

Depreciation may be computed on a straight line basis as

Depreciation = (cost - salvage value)/estimated useful life

Given that Matthews Band pays $65,800 for sound equipment. The band estimates it will use this equipment for four years and after four years it can sell the equipment for $2,000

Depreciation in the first year of use

= ($65,800 - $2,000)/4

= $15,950

The carrying amount at the start of the second year

= $65,800 - $15,950

= $49,850

Depreciation for the second year and 3rd year after the company realizes that this equipment will last only a total of three years

= ($49,850 - $2,000)/2

= $47,850/2

= $23,925

TRUE OR FALSE ? WHY ? HELP ME
7. The best measure of the opportunity cost of holding money is the real interest rate.
8. The enactment of the minimum wage law can lead to unemployment according to the classical theory.
9. The increase or decrease in inventory is always within the expectation of enterprises.

Answers

7. True

8. False

9. False

Must click thanks and mark brainliest

Sorry if wrong.

The amount of checks that have been received and deposited but have not yet been made available to the account in which they were deposited is the ____ float.

a. disbursement
b. net
c.collections
d. balance
e. deposit

Answers

Deposit? Maybe I’m maybe wrong

In general, a project's free cash flows will fall in one of the following three categories: initial outlay, annual free cash flows over the project's life, and the terminal free cash flow.
a) true
b) false

Answers

Answer:

a true espero te sirva ;))))))))

Demand Inventory Case A company has two products with demand patterns as follows over 12 months across three years. The sales across these months are provided in the attached Excel file. Part A Analyze the demand patterns and answer what kind of demand forecasting technique would you use for each product

Answers

Answer:

For Product A: Exponential Smoothing

For Product B: Simple Moving Average

Explanation:

There are five main types of forecasting techniques;

1. Simple Moving Average

2. Exponential Smoothing

3. Autoregressive Integration Moving Average

4. Neural Network

5. Croston

Vincent corporation has 100,00 shares of 100 par common stock outstanding. on june30 ,Vincent corporation declared a 5% stock dividend to be issued on July 30 to stockholders of record july15. the market price of the stock was $132 a share on June 30. journalize the entries required on June 30 and july30

Answers

The common stock that is seen here would be $500000

What is the common stock outstanding?

This is the term that would simply be used to refer to all of the shares that the shareholders of a company as well as the people that are the insiders in the company would own.

How to solve for the journal entries

The retained earnings is given as

$132 * 0.05

= $6.6

= 6.6 x 100000

= 660000

The debit is $660000

The credit is 100000 x 5 = 500000

paid in capital in excess of par =  660000 - 500000

= $160000

The stock dividend distributable = $500000

common stock is given as $500000

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Rose dies with passive activity property having an adjusted basis of $156,400, suspended losses of $50,048, and a fair market value at the date of her death of $218,960. Of the $50,048 suspended loss existing at the time of Rose's death, how much is deductible on her final return or by the beneficiary

Answers

Answer:

12512 dollars that she have

All the individuals that buy the product for their personal consumption is called………

Answers

Answer:

A consumer

Explanation:

Professional service organizations include __________.

Answers

Answer:

Accenture, Ernst and Young, KPMG, Deloitte.

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