a flood control  dam is being proposed for construction. The initial cost is estimated to be  P4,600,000, with annual maintenance and inspection costs of P24,000. Every  5 years, minor reconstruction work will be undertaken on the dam at a cost of P150,000. If the dam is built, flood damage is expected to be reduced from  P800,000 to P100,000 annually. Assuming the dam to be permanent and the  interest rate is 8%, should the dam be built?

Q: Salalah Methanol Co. has bought some new machinery at a cost of 1250000 OMR. The impact of the new…

A: Capital budgeting approaches are the methodologies adopted by the top-level management to evaluate…

Q: A dam will have a first cost of P250,000,000, an annual maintenance cost of P1,250,000 and minor…

A: A capitalized cost seems to be a cost incurred as a consequence of the acquisition of a fixed asset…

Q: In 2015, the UGBS embarked on a project. The project will receive annual inflows of GHC 30,000 from…

A: Net present value refers to the comparison of present values of all cashflows with its initial…

Q: A project will have annual operating cash flows of $36,500 for four years. At the beginning of the…

A: Net Present Value (NPV) = Present Value of Cash Inflows - Initial Investment

Q: The Salalah Golf Resorts is redoing its golf course at a cost of 2744320 OMR. It expects to generate…

A: Net present value is the present value of an investment in todays time after adjusting all the…

Q: Consider palletizer at a bottling plant that has a first cost of $134,338, has operating and…

A: Given data, Initial investment = $134,338 Operating and maintenance cots= $17,980 Net salvage value…

Q: The following are the costs for one of the alternatives to construct a new bridge: Construction cost…

A: We are given the costs of an alternative to construct a new bridge.  The initial construction cost…

Q: 20000 OMR, 70000 OMR, and 10000C ent, what is the NPV of this project?

A: The NPV of the project can be computed as follows :

Q: Maud'Dib Intergalactic has a new project available on Arrakis. The cost of the project is $34,500…

A: Step 1: Identify all the relevant data in the problemCost of project: $34,500*cash flows of $18,600,…

Q: /hat is the project's discounted payback period?

A: In the payback period method, the time value of money is not taken into consideration in order to…

Q: Dhofar Art Gallery is adding to its existing buildings at a cost of 250000 OMR . The gallery expects…

A:

Q: A proposed project requires an initial cash outlay of $75,000 for equipment and an additional cash…

A: NPV= Pv of cash flow=[-75,000/(1+0.122)0]+[-25,000/(1+0.122)1] +[ 50,000/(1+0.122)2+[…

Q: od and Health Company is expanding and has an average-risk project under consideration. The company…

A: IRR is the rate at which present value of cash inflows are equal to present value of cash outflows.

Q: Oredo is installing new equipment at a cost of 240000 OMR. Expected cash flows from this project…

A: as cash flows are uneven, we will using be using the following formula Discounted payback period =…

Q: Ive ye is the payback period for - If their acceptance peric

A: The Payback period is the amount of time needed to earn back the cost of an investment. This method…

Q: A flood control project with a life of 14 years will require an investment of $57.000 and annual…

A: Benefit to cost ratio: It is ratio of present value of the benefits to present value of costs.

Q: An investment has an installed cost of $527,630. The cash flows over the four-year life of the…

A: NPV is one of the capital budgeting techniques to evaluate the acceptability of a project. NPV…

Q: L& T Corporation is considering an investment proposal in which a working capital investment of…

A: Present value (PV) refers to the determination of the value of money at present that is expected to…

Q: . Project 2 has a computed net present value of $26,300 over a 4-year life. Project 1 could be sold…

A: Net present value is one of the most important methods of capital budgeting based on the time value…

Q: ent of Public Works and Highways is considering the construction of new highway through a scenic…

A: Benefit cost ratio is present value of annual benefits to initial investment.

Q: A flexible pavement construction project is proposed. The estimated service life is 20 years. The…

A: NPV = -205000

Q: end of each year of use) and a new contract the client is considering entering will fix the pree…

A: Decision Making - It is process of best suitable resolutions within the available scope of…

Q: A project cost is RO. 30,000 and the expected cash inflows every year is RO. 7000. The total life of…

A: Annual expected Cash Flow              7,000   Initial investment            30,000   Payback…

Q: he average annual cost of damages caused by floods to certain subdivision located along Pasig River…

A: Annuity: this is used in case of a future annuity – suppose an equal sum of money is invested in the…

Q: Project 1 requires an original investment of $48,500. The project will yield cash flows of $13,000…

A: For determining the NPV, present value of $13,000 annual flows and $54,000 salvage will be…

Q: A company is developing a special vehicle for Arctic exploration. The development requires an…

A: The net present value of a project is the present value of all future cash flows associated with the…

Q: Mini Inc. is contemplating a capital project costing $47,019. The project will provide annual cost…

A: Net Present Value = (Annual cost savings x present value of annuity at 10%, 3 year) + (salvage value…

Q: A project is expected to create operating cash flows of $25,300 a year for four years. The fixed…

A: NPV is also known as Net Present Value.. It is a capital budgeting technique which helps in decision…

Q: roject 1 requires an original investment of $54,000. The project will yield cash flows of $8,000 per…

A: Net present value is defined as the summation of the present value of cash inflows in each period…

Q: The construction of a bypass road needs a capital investment of $200,000 and $10,000 would be…

A: Note: We’ll answer the first question since the exact one wasn’t specified. Please submit a new…

Q: 5. Does your company want to purchase this machine that will provide cost savings of $100,000…

A: NPV is also known as Net Present value. It is a capital budgeting technique which helps in decision…

Q: A new project will have an intial cost of $100,000. Cash flows from the project are expected to be…

A: Net present value (NPV) is a financial metric used to determine the value of an investment by…

Q: San Diego Enterprises is planning to invest in a five-year project costing $270,000. The project is…

A: Payback period is the amount of time required to recover initial investment. It can be calculated…

Q: Dhofar Art Gallery is adding to its existing buildings at a cost of 200000 OMR. The gallery expects…

A: Year Cash Flow  Discount factor @10% Discounted value 1 20,000 0.90909 18,181.82 2 70,000…

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.