Chapter 14 Takehome Problems

What is the building s cap rate ? Solve this question general Accounting

3. The garden supply company is also considering taking out a loan and buying a small truck to save costs on deliveries. The truck costs $60,000 and is expected to earn end of year after tax net cash inflows of $10000, $15000, $20000 and $20000 for the next four years before it wears out sufficiently to be unreliable and must be sold for an estimated $10000 (after tax). a. Calculate the NPV of the truck if the interest rate on the loan is 5% pa. b. Calculate the NPV of the truck if the interest rate on the loan is 10% pa. c. Advise management of your recommendation regarding purchase of the truck based on your NPV calculations. d. Calculate the accounting rate of return on the truck investment. e. What additional advice would you give management if the required payback period was three years? All working required.

The garden supply company is also considering taking out a loan and buying a small truck to save costs on deliveries. The truck costs $60,000 and is expected to earn end of year after tax net cash inflows of $10000, $15000, $20000 and $20000 for the next four years before it wears out sufficiently to be unreliable and must be sold for an estimated $10000 (after tax).                                                                                                                                                                                           Required Calculate the NPV of the truck if the interest rate on the loan is 5% pa. Calculate the NPV of the truck if the interest rate on the loan is 10% pa.  Advise management of your recommendation regarding purchase of the truck based on your NPV calculations.  Calculate the accounting rate of return on the truck investment e. What additional advice would you give management if the required payback period was three years? Please…

The garden supply company is also considering taking out a loan and buying a small truck to save costs on deliveries. The truck costs $60,000 and is expected to earn end of year after tax net cash inflows of $10000, $15000, $20000 and $20000 for the next four years before it wears out sufficiently to be unreliable and must be sold for an estimated $10000 (after tax).                                                                                                                                                                                           Required Calculate the NPV of the truck if the interest rate on the loan is 5% pa. Calculate the NPV of the truck if the interest rate on the loan is 10% pa. Advise management of your recommendation regarding purchase of the truck based on your NPV calculations.  Calculate the accounting rate of return on the truck investment.  e. What additional advice would you give management if the required payback period was three years?

The garden supply company is also considering taking out a loan and buying a small truck to save costs on deliveries. The truck costs $60000 and is expected to earn end of year after tax net cash inflows of $11000, $17000, $20000 and $20000 for the next four years before it wears out sufficiently to be unreliable and must be sold for an estimated $18000 (after tax).                                                      a) Calculate the NPV of the truck if the interest rate on the loan is 4.0% pa.                                                    Year Transactions Cost flow PV Factor at 4% Discounted cash flows 0 Cost (60,000) 1 (60,000) 1 After-tax net cash inflows 11,000 0.9615 10,577 2 After-tax net cash inflows 17,000 0.9246 15,718 3 After-tax net cash inflows 20,000 0.8890 17,780 4 After-tax net cash inflows 20,000 0.8548 17,096 4 Realizable value after tax 18,000 0.8548 15,386…

The owner of a pizza restaurant needs to buy a new pizza oven for the restaurant. The oven costs $450, is expected to last 5 years, and will be depreciated using the straight line method. If the total cash inflows from the new oven are constant at $750 for the next 5 years, and the total cash outflows are constant at $380 for the next 5 years, determine the cash flow for the pizza restaurant in the second year assuming the tax rate is 34%. $ Place your answer in dollars and cents.

Imagine that you are trying to evaluate the economics of purchasing an automobile. You expect the car to provide annual cash benefits of $1,200 at the end of each year, and assume that you can sell the car for proceeds of $5,000 at the end of the planned 5-year ownership period. All funds which are you use has 6% discount rate. What should be the required return applicable to valuing the car. Lütfen birini seçin: O a. 4% O b. 6% c. 5% O d. 7%

A business is considering purchasing a piece of new equipment for $200,000. The equipment will generate the following revenues: Year 1: $50,000 Year 2: $50,000 Year 3: $50,000 Year 4: $60,000 The machine can be sold at the end of the year four for $25,000. Assume a discount of 8%. Based on your above calculations, should they purchase the new piece of equipment? Why?   2. Carl and Melissa have monthly income of $6000. They want to buy a house for $200,000 and make a down payment of $40,000. The monthly payment on a 15-year mortgage will be $2,000 and a 30- year mortgage, the monthly payment will be $1,350. Which of the following would you recommend? Why? A. 15 year option B. 30 year option C. They cannot afford to buy a house at this point

Tony Ring wants to attend Northeast College. He will need $60,000 4 years from today. Assume Tony’s bank pays 12% interest compounded semiannually. Amount needed $ 60,000.00 Length of time needed from today 4 Interest 12% Compounded Semiannually Required: Complete the following using the information above and the present value Table 12.3 or the present value table in the Business Math Handbook to answer the following: Period used: Rate used: Factor used: What must Tony deposit today so he will have $60,000 in 4 years?

can you please help me to this account questions

what would the formula be to solve for the table value? the table value is what i need to solve the problem