xercise 11-7 (Algo) Net present value and unequal cash flows LO P3 Gomez is considering a $240,000 investment with the following net cash flows. Gomez requires a 12% return on its investments. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Year 1Year 2Year 3Year 4Year 5 Net cash flows$72,000$45,000$71,000$160,000$57,000 (a) Compute the net present value of this investment. (b) Should Gomez accept the investment

Answers

Answer 1

The net present value of this investment is $44,722.06.

The investment should be accepted.

Net present value is a capital budgeting method. It is calculated as the present value of after-tax cash flows from an investment less the amount invested in the project.  

NPV can be calculated using a financial calculator .

Only projects with a positive NPV should be accepted.

Cash flow in year 0 = $-240,000

Cash flow in year 1 = $72,000

Cash flow in year 2 = $45,000

Cash flow in year 3 = $71,000

Cash flow in year 4 = $160,000

Cash flow in year 5 =  $57,000

Interest rate = 12%

NPV = $44,722.06

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Related Questions

Bonds which require the face value (principal) amount to be paid back in installments over the life of the bond are called: Select one: a. callable bonds. b. term bonds. c. convertible bonds. d. secured bonds. e. serial bonds. f. unsecured bonds.

Answers

Answer:

Term bonds are bonds from a single issue that all mature on the same date. On the maturity date of term bonds, the face value (principal) must be repaid to the bondholders. Call provisions within term bonds stipulate characteristics where issuers can redeem bonds from investors prior to the maturity date.

Explanation:

hope it helps <3

Term bonds are bonds that require the face value (principal) to be paid back in installments over the bond's life. As a result, option (b) is the proper response.

What are term bonds?

Term bonds are bonds that all maturity on the same date from a single issue.

The face value (principal) of term bonds must be repaid to bondholders when they reach maturity.

Issuers can repay bonds from investors prior to the maturity date under call provisions in term bonds.

For more information about term bonds, refer below

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Woh Che Co. has four departments: Materials, Personnel, Manufacturing, and Packaging. In a recent month, the four departments incurred three shared indirect expenses. The amounts of these indirect expenses and the bases used to allocate them follow.
Indirect Expense Cost Allocation Base
Supervision $ 82,500 Number of employees
Utilities 50,000 Square feet occupied
Insurance 22,500 Value of assets in use
Total $ 155,000
Departmental data for the company’s recent reporting period follow.
Department Employees Square Feet Asset Values
Materials 27 25,000 $ 6,000
Personnel 9 5,000 1,200
Manufacturing 63 55,000 37,800
Packaging 51 15,000 15,000
Total 150 100,000 $ 60,000
1. Use this information to allocate each of the three indirect expenses across the four departments.
2. Prepare a summary table that reports the indirect expenses assigned to each of the four departments.

Answers

1. The allocation of the three indirect expenses across the four departments of Woh Checo is as follows:

Supervision Expense:

Basis = Number of Employees

Materials = $14,850 ($82,500 x 27/150)

Personnel = $4,950 ($82,500 x 9/150)

Manufacturing = $34,650 ($82,500 x 63/150)

Packaging = $28,050 ($82,500 x 51/150)

Utilities Expense:

Basis = Square Feet

Materials = $12,500 ($50,000 x 25,000/100,000)

Personnel = $2,500 ($50,000 x 5,000/100,000)

Manufacturing = $27,500 ($50,000 x 55,000/100,000)

Packaging = $7,500 ($50,000 x 15,000/100,000)

Insurance Expense:

Basis = Assets Value

Materials = $2,250 ($22,500 x 6,000/$60,000)

Personnel = $450 ($22,500 x 1,200/$60,000)

Manufacturing = $14,175 ($22,500 x 37,800/$60,000)

Packaging = $5,625 ($22,500 x 15,000/$60,000)

2. The summary table to report the assignment of the indirect expenses to the four departments is as follows:

Allocation of Indirect Expenses to the Departments:

                         Total      Materials    Personnel    Manufacturing   Packaging

Supervision  $82,500     $14,850      $4,950           $34,650        $28,050

Utilities           50,000       12,500        2,500             27,500             7,500

Insurance      22,500        2,250            450               14,175             5,625

Total          $ 155,000   $29,600       $7,900          $76,325          $41,175

Data and Calculations:

Indirect Expense        Cost         Allocation Base

Supervision            $ 82,500     Number of employees

Utilities                      50,000     Square feet occupied

Insurance                  22,500     Value of assets in use

Total                     $ 155,000

Department    Employees    Square Feet     Asset Values

Materials                 27               25,000            $ 6,000

Personnel                 9                 5,000                1,200

Manufacturing        63              55,000             37,800

Packaging               51               15,000              15,000

Total                      150            100,000          $ 60,000

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Information accessibility focuses on ________.

a. defining what information a person or organization has the right to obtain about others.
b. information that has been encrypted by the owner to make it unaccessible to others
c. who owns information about individuals and how information can be sold and exchanged
d. what information an individual should have to reveal to others in the workplace
e. identifying who is responsible for informational errors that harm people

Answers

Answer:

A) Defining what information a person or organization has the right to obtain about others.

A local university has 6 faculty members for every 150 students. How many faculty members are needed for 9,575 students?

Number of faculty members

What’s the answer?

Answers

150/6=25 9575/25=383
Answer = 383

think of some examples of products for which people are willing to pay premium prices. Name one such product and explain why you think consumers value it so highly.

Answers

iPhone. People pay a ton for iPhones. I think people pay so much because it’s a computer in ur pocket.

An example in today's time would be Apple iPhone as individuals are willing to spend premium costs for mobile phones. People do regard buying this because of quality, features and it has also become a position symbol in today's time.

Difference between luxury and premium?

The key distinction here exists that a luxury brand, to remain luxury, has to include limits on the volume of sales. By its nature, it can't be available to everyone. Premium, on the other hand, can still enjoy big sales sculptures at an over-average rate. Premium brands' target customers exist as those who can push themselves to bear higher than what they pay for an average product.

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If a bank that faces a 25 percent reserve ratio received a deposit of $30,000 and makes a loan to a customer for $10,000, what is the consequence if the bank then deposits the rest of the funds at the Federal Reserve

Answers

The consequence if the bank deposits the rest of the funds at the Federal Reserve is that Excess reserves increase by $12,500 and required reserves increase by $7,500.

Data and Calculations:

Reserve ratio = 25%

Deposit received by the bank = $30,000

Reserves increase = $7,500 ($30,00 x 25%)

Loan made to a customer = $10,000

Thus, the excess reserves would increase to $12,500 ($30,000 - $7,500 - $10,000).

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a printed order for payment of a specified sum,facilitaded by the bank ir post office​

Answers

answer is money order

Imagine that in 2019 the economy is in long-run equilibrium. Then stock prices rise more than expected and stay high for some time. Refer to Scenario 33-2. In the short run what happens to the price level and real GDP

Answers

In the short-run, the effect on the price level and the real GDP is a. Both the price level and real GDP rise.

Since the economy is in long-run equilibrium in 2019, and the stock prices unexpectedly rise and stay high for a long time, it means that the price level does not:

Rise while the real GDP falls Fall while the real GDP rises Fall with the real GDP.

Question Options:

a. both the price level and real GDP rise.

b. the price level rises and real GDP falls.

c. the price level falls and real GDP rises.

d. both the price level and real GDP fall.

Thus, in the short-term of this economy both the price level and real GDP rise.

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Can a business have too many channel mem

Answers

Answer:

oo many sales channels become difficult to manage and fewer committed resellers means you can foster stronger sales relationships.

Explanation:

hope it helps <3

York’s outstanding stock consists of 80,000 shares of noncumulative 7.5% preferred stock with a $5 par value and also 200,000 shares of common stock with a $1 par value. During its first four years of operation, the corporation declared and paid the following total cash dividends

Determine the amount of dividends paid each year to each of the two classes of stockholders: preferred and common. (Round your "Dividend per Preferred Share" answer to 3 decimal places.)

Answers

This question is incomplete and the complete question is as follows:

York’s outstanding stock consists of 80,000 shares of noncumulative 7.5% preferred stock with a $5 par value and also 200,000 shares of common stock with a $1 par value. During its first four years of operation, the corporation declared and paid the following total cash dividends:

2016 total cash dividends = $20,000

2018 total cash dividends = $200,000

2017 total cash dividends = $28,000

2019 total cash dividends = $350,000

Determine the amount of dividends paid each year to each of the two classes of stockholders: preferred and common. (Round your "Dividend per Preferred Share" answer to 3 decimal places.)

To answer the question, Preferred and Common stocks are first described.

Preferred stocks are stock shares that pay dividends to holders before common stock dividends are paid.

Cumulative preferred stock is a type of preference stock with a clause that requires a corporation to pay all dividends to cumulative preferred shareholders, including those that were missed before.

Common stocks are stock shares that pay dividends to holders after preferred stock dividends have been paid.  

The attached photo contains the calculations of the answers.

From the attached photo, we have:

Dividend per preferred share = $0.375

Amount of dividends paid preferred shares in 2016 = $20,000  

Amount of dividends paid preferred shares in 2017 = $28,000  

Amount of dividends paid preferred shares in 2018 = $42,000

Amount of dividends paid preferred shares in 2019 = $30,000

In addition, from the attached photo, we have:

Amount of dividends paid to Common shares in 2016 = $0

Amount of dividends paid to Common shares in 2017 = $0

Amount of dividends paid to Common shares in 2018 = $158,000

Amount of dividends paid to Common shares in 2019 = $320,000

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Banks in Ruritania have a required reserve ratio of 8% . Round all answers to one place after the decimal. What is the simple money multiplier

Answers

The simple money multiplier is 12.5.

The reserve ratio is the ratio the Central Bank of a country requires banks to keep as reserves in order to meet unforeseen circumstances. For example, if the reserve ratio is 8%, if a customers deposits $1000, banks must keep $80 as reserves.

Money multiplier is the maximum amount of money commercial banks can create.

Money multiplier = 1 / reserve ratio

1 / 8%

1 / 0.08 = 12.5

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When informing your staff of the date for the company picnic, a __________ would be most practical and successful.

a. videoconference
b. newspaper notice
c. telephone conversation
d. face-to-face conversation
✔ e. memo

Answers

Answer:

face to face conversation

Transparency refers to

Answers

Explanation:

Transparency, as used in science, engineering, business, the humanities and in other social contexts, is operating in such a way that it is easy for others to see what actions are performed. Transparency implies openness, communication, and accountability.

The cat ____ the food.

A. eat
b. drink
c. up
d. run

Answers

Answer:

eat

Explanation:

Answer:

eat

Explanation:

guys help me pls (30points)
What is an example of a behavior associated with a negative attitude?

a
Being rude to a co-worker

b
Finishing your work a day early

c
Helping a co-worker with a project

d
Showing up to work on time

Answers

Answer: A

B is being prepared

C is an example of teamwork

D is an example of being prepared

So the answer is A

Explanation:

1. Describe the various advantages that firms such as Tata employ to become large industrial conglomerates.

Answers

Answer:

Company

Explanation:

The common stock of High Energy is selling for $58 per share. Currently, the firm has a total market value of $1,314,900 and a book value of $647,600. How many shares of stock will be outstanding if the firm does a stock split of 5-for-2

Answers

The number of shares of stock that will be outstanding if the firm does a stock split of 5-for-2 is $56,677.

Using this formula

Outstanding shares=(Total market value/Common stock per share)×Stock split

Let plug in the formula

Outstanding shares=($1,314,900 /$58)×5/2

Outstanding shares=$56,676.72 shares

Outstanding shares=$56,677 shares (Approximately)

Inconclusion the number of shares of stock that will be outstanding if the firm does a stock split of 5-for-2 is $56,677.

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In your opinion, what are the three most important microeconomic issues of our society today?

Answers

Answer:

voting rights, hand weapon violence, and the pandemic

Explanation:

the worldwide issue right now is the pandemic and that's what everybody is worried about, along with that comes healthcare.

SEVEN (7) rewards and THREE (3) Challenges of the CEO of this company

Answers

What? What does this mean?

Eric Patterson earns $82,000 a year. His monthly expenses total $5,400. What is the minimum amount of money that he should set aside in an emergency fund

Answers

Based on the amount earned and the monthly expenses, Eric should set aside $16,200 for an emergency fund.

It is generally recommended that when settling cash aside for an emergency fund, the amount that one sets aside be 3 times their monthly expenses.

Eric's monthly expenses are $5,400 so the amount to be set aside should be:

= 5,400 x 3

= $16,200

In conclusion, Eric should set aside $16,200 for the emergency fund.

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__ is the monetary value of what a company received for goods sold, services rendered, and all other payments to the firm.

Answers

The  monetary value that is been gotten by a company for the sold goods as well as services rendered and payments to the firm is revenue.

Revenue can be regarded as money that is been received from normal business operations.

This can be calculated by multiplying average sales price with number of units sold.

Therefore, revenue is the correct term.

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Which of the following is not considered a special journal?
a. cash receipts journal
Ob. general journal
c. purchases journal
d. cash payments journal

Answers

Answer:b

Explanation:

There is no such thing as a specialty magazine for a general journal. Therefore, the correct option is B.

Special journals, commonly called subsidiary journals, are used to record special types of transactions systematically and effectively. Cash receipt diary, purchases journal, and cash payment notebook are some examples of specialty journals.

These journals are created to deal with large volumes of transactions of a specific type, including cash payments, purchases or receipts. In contrast, the purpose of the general journal is to record transactions that do not fall under the precise categories covered by the special journal. It serves a more general purpose. It is often used for irregular or unusual transactions.

Therefore, the correct option is B.

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Logic teaches students how to think for themselves. It helps them develop their critical thinking skill. It gives them the ability to analyze and evaluate arguments. I think it should be taught in schools.

Answers

Answer:

what is the question tho?

Explanation:

Food For Less (FFL), a grocery store, is considering offering one hour photo developing in their store. The firm expects that sales from the new one hour machine will be $150,000 per year. FFL currently offers overnight film processing with annual sales of $100,000. While many of the one hour photo sales will be to new customers, FFL estimates that 60% of their current overnight photo customers will switch and use the one hour service. Suppose that of the 60% of FFL's current overnight photo customers, half would start taking their film to a competitor that offers one hour photo processing if FFL fails to offer the one hour service. The level of incremental sales in this case is closest to:___.
a. $60,000.
b. $150,000.
c. $120,000.
d. $90,000.
Suppose that of the 60% of FFL's current overnight photo customers, half would start taking their film to a competitor that offers one hour photo processing if FFL fails to offer the one hour service. The level of incremental sales in this case is closest to:
A) $60,000.
B) $150,000.
C) $90,000.
D) $120,000.

Answers

Answer:

90,000 the answerrr is 90,000

Which person would benefit most from taking advantage of a low variable
interest rate?
A. Emilio needs a loan to support his business and needs his
payments to be as predictable as possible.
B. Ellie has just found her dream home and wants to get a mortgage
that will allow her to live there forever.
C. Evan needs to borrow money to pay for car repairs, but he will be
able to pay off the loan within two to three months.
D. Erica needs to borrow money to attend college, but she doesn't
have a good credit history.

Answers

Based on the information, the individual that'll benefit from the interest rate will be C. Evan needs to borrow money to pay for car repairs, but he will be able to pay off the loan within two to three months.

A variable interest rate simply means an interest rate that fluctuates. It's different from a fixed interest rate. It should be noted that variable interest rates have low interest rates and are typically used for short-term financing.

Therefore, the person that would benefit most from taking advantage of a low variable interest rate will be Evan who needs to borrow money to pay for car repairs, but he will be able to pay off the loan within two to three months.

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Answer:

c

Explanation:

your salary is $50,000 income tax rate is 21% on the first $35,000 and 23% on the rest of your income what is the total amount of tax that you owe A.$10,500 B. $10,770 C. $10,800 D.$11,500​

Answers

Answer:

C

Explanation:

35000 = 100%

35000×0.21 = 21% = $7350

50000 - 35000 = 15000 = 100%

15000×0.23 = 23% = $3450

so, in total, I pay

7350 + 3450 = $10,800

All of the following is true about CRM, or Customer Relationship Management except:______.
a. It is an enterprise software
b. Accounting department uses it to facilitate billing
c. It is replacing the human resource department
d. It is the processes a company uses to track and organize all aspects of customer encounters

Answers

Answer:

B

Explanation:

The purpose of CRM is not to replace the human resource department.

Considering the available options, the statement that is not true about CRM or Customer Relationship Management is "Accounting department uses it to facilitate billing."

CRM is an enterprise software with a rough global market value of over $40 billion.

Because it is an automated system, many firms are now using it to replace the human resource department.

Also, CRM is known for being a process that a company uses to monitor and oversee all aspects of customer relations.

Hence, in this case, it is concluded that the correct answer is option B. "Accounting department uses it to facilitate billing."

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refer to the makeup of a firms capitalization

Answers

Finance. Another aspect of capitalization refers to the company's capital structure. Capitalization can refer to the book value cost of capital, which is the sum of a company's long-term debt, stock, and retained earnings. ... Companies with a high market capitalization are referred to as large caps.

How are flexible exchange rates different from fixed exchange rates?

Answers

flexible exchange rates depend on multiple variables in the market but fixed exchange rates stay the same no matter the change in variables.

Baker Corp. pays a constant $1.8 dividend on its stock. The company will maintain this dividend for the next 15 years and will then cease paying dividends forever. If the required return on this stock is 5 percent, what would the current share price be

Answers

Answer:

1.8 divided by 15 easy

Explanation:

0. somthing

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