tax quiz 6 2

(b) In order to choose between Project A and Project B, the project planner must make a decision. The following data pertains to the projects: Project P Project Q Capital cost of asset 60,000 60,000 Profits before depreciation Project A Project B Year 1 20,000 50,000 Year 2 30,000 20,000 Year 3 40,000 5,000 Year 4 50,000 5,000 Year 5 60,000 5,000 (i) From the analysis using payback period method, which project will be more preferred? Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.

6. Determine the maximum operating income possible with the expanded plant. 7. If the proposal is accepted and sales remain at the rrent level, what will the operating income or loss be for the following 103,500,000 x Income

Zenith Investment Company is considering the purchase of an office property. It has done an extensive market analysis and has estimated that based on current market supply or demand relationships, rents, and its estimate of operating expenses, annual NO/ will be as follows: Year 1 12345678 ΝΟΙ $ 1,105,000 1,105,000 1,105,000 1,235,000 1,285,000 1,335,000 1,374,000 1,414,170 A market that is currently oversupplied is expected to result in cash flows remaining flat for the next three years at $1,105,000. During years 4, 5, and 6, market rents are expected to be higher. It is further expected that beginning in year 7 and every year thereafter, NOI will tend to reflect a stable, balanced market and should grow at 3 percent per year indefinitely. Zenith believes that investors should earn a 12 percent return (r) on an investment of this kind. Required: a. Assuming that the investment is expected to produce NO/ in years 1 to 8 and is expected to be owned for seven years and then sold, what…

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Consider a project with the following information: Initial fixed asset investment = $515,000; straight-line depreciation to zero over the 4-year life; zero salvage value; price = $47; variable costs = $29; fixed costs = $207,000; quantity sold = 102,000 units; tax rate = 21 percent.    How sensitive is OCF to changes in quantity sold? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) find the change in OCF/Change in Q

Consider a project with the following information: Initial fixed asset investment = $515,000; straight-line depreciation to zero over the 4-year life; zero salvage value; price = $47; variable costs = $29; fixed costs = $207,000; quantity sold = 102,000 units; tax rate = 21 percent.    How sensitive is OCF to changes in quantity sold? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)   Change in OCF/ Change in Q =?

Information for two alternative projects involving machinery investments follows: Project 1 Initial investment Salvage value Annual income $ (128,000) Ө Project 2 $ (98,000) 18,000 14,080 11,600 a. Compute accounting rate of return for each project. b. Based on accounting rate of return, which project is preferred? Complete this question by entering your answers in the tabs below. Required A Required B Compute accounting rate of return for each project. Project 1 Project 2 Numerator: Accounting Rate of Return Denominator: Required A Required B Based on accounting rate of return, which project is preferred? Based on accounting rate of return, is preferred. = Accounting rate of return

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Answer the given question with a proper explanation and step-by-step solution. Please provide the answer using the math tool otherwise I give the downvote.

Zenith Investment Company is considering the purchase of an office property. It has done an extensive market analysis and has estimated that based on current market supply or demand relationships, rents, and its estimate of operating expenses, annual NOI will be as follows:  Year NOI 1 $ 1,030,000 2 1,030,000 3 1,030,000 4 1,210,000 5 1,260,000 6 1,310,000 7 1,349,000 8 1,389,170 A market that is currently oversupplied is expected to result in cash flows remaining flat for the next three years at $1,030,000. During years 4, 5, and 6, market rents are expected to be higher. It is further expected that beginning in year 7 and every year thereafter, NOI will tend to reflect a stable, balanced market and should grow at 3 percent per year indefinitely. Zenith believes that investors should earn a 12 percent return (r) on an investment of this kind.Required: a. Assuming that the investment is expected to produce NOI in years 1 to 8 and is expected to be owned for…

Consider a three-year project with the following information: initial fixed asset investment = $710,000; straight-line depreciation to zero over the 5-year life; zero salvage value; price = $39.39; variable costs = $28.31; fixed costs = $332,000; quantity sold = 87,000 units; tax rate = 24 percent. How sensitive is OCF to changes in quantity sold? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) AOCF/AQ

In the development of a publicly owned, commercial waterfront area, three possible independent plans are being considered. Their costs and estimated benefits are as follows (shown): Solve, a. Which plan(s) should be adopted, if any, if the controlling board wishes to invest any amount required, provided that the B–C ratio on the required investment is at least 1.0? b. Suppose that 10% of the costs of each plan are reclassified as disbenefits. What percentage change in the B–C ratio of each plan results from the reclassification? c. Comment on why the rank-orderings in (a) are unaffected by the change in (b).

In the development of a publicly owned, commercial waterfront area, three possible independent plans are being considered. Their costs and estimated benefits are given in the table to the right. a. Which plan(s) should be adopted, if any, if the controlling board wishes to invest any amount required, provided that the B-C ratio on the required investment is at least 1.0? b. Suppose that 5% of the costs of each plan are reclassified as disbenefits. What percentage change in the B-C ratio of each plan results from the reclassification? c. Comment on why the rank-orderings in (a) are unaffected by the change in (b). a. Perform the B-C analysis. Fill-in the table below. (Round to four decimal places.) Plan A B-C ratio Is the alternative acceptable? Plan A B с PW ($000s) Costs Benefits $125,000 $139,000 107.000 152,000 137,000 104,000

Using the following two relationships: AW = CR + A of AOC CR = -P(A/P,i,n) + S(A/F,i,n) %3D Calculate the Annual Worth (AW) based on the data for the following project: Corporate MARR = 10% Initial Investment Cost $1,000,000 Anticipated Project Life = 10 years Salvage Value at the end of 10 years $100,000 Annual Cost of Operation %3D $50,000 10% Compound Interest Factors

In a cost center, the manager has responsibility and authority for making decisions that affect a. costs b. investments in assets c. both costs and revenues d. revenues   Keating Co. is considering disposing of equipment with a cost of $68,000 and accumulated depreciation of $47,600. Keating Co. can sell the equipment through a broker for $27,000 less 8% commission. Alternatively, Gunner Co. has offered to lease the equipment for five years for a total of $46,000. Keating will incur repair, insurance, and property tax expenses estimated at $10,000 over the five-year period. At lease-end, the equipment is expected to have no residual value. The net differential income from the lease alternative is a. $11,160 b. $7,812 c. $16,740 d. $13,392   If sales are $828,000, variable costs are 68% of sales, and operating income is $278,000, what is the contribution margin ratio? a. 64% b. 36% c. 68% d. 32%

Apply WACC in IRR.   Leeward Sailboats is reviewing the following new boat​ line:   Category T0 T1 T2 T3   Investment −​$9,116,807           Net working capital change −​$636,000       ​$636,000   Operating cash flow     ​$2,930,000 ​$3,413,000 ​$4,156,000   Salvage         ​$597,000     At what adjusted WACCs will the company accept this​ project?   Hint​: Find the IRR of the​ project, and use it as the maximum adjusted WACC for accepting the project. What is the IRR of the​ project?  ​(Round to two decimal​ places.)

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You purchase a multifamily property for $4,500,000. You commission a cost segregation study to determine how the cost should be allocated and determine the following:\\n\\nLand: 30%\\n\\nResidential Improvements: 55%\\n\\nLand Improvements: 10%\\n\\nFurniture, Fixtures & Equipment: 5%\\n\\nWhat is your projected depreciation expense associated with this property? (Round your answer to the nearest dollar)\\nPlease provide an excel file with labels and formulas, Thank you

What is the site value? General Accounting question

Calculate the NPV of an asset replacement given the following information: Investment = $180,000; salvage recovered now = $70,000; operating cash flows = $180,000; PV of salvage forgone = $5,500; PV of salvage recovered = $14,000; CCATS = $35,000. Multiple Choice $119,500 $121,500 $115,500 $113,500  $117,500

Dog Up! Franks is looking at a new sausage system with an installed cost of $685,000. This cost will be depreciated straight-line to zero over the project's 5-year life, at the end of which the sausage system can be scrapped for $91,000. The sausage system will save the firm $195,000 per year in pretax operating costs, and the system requires an initial investment in net working capital of $47,000. If the tax rate is 21 percent and the discount rate is 10 percent, what is the NPV of this project? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. NPV