Calculate the Payback Period using the following Information All figures are in OMR Initial Investment = 10000 Cash Flow after Tax(CFAT) are as follows : Year 1 : 5000 Year 2 : 3000 Year 3 : 2000 Year 4 : 3000 Year 5 : 50000 2.5 Years 3 Years 3 Years and 10 months 3 Years and 2 months

Calculate the Payback Period using the following Information All figures are in OMR Initial Investment = 10000 Cash Flow after Tax(CFAT) are as follows : Year 1 : 5000 Year 2 : 3000 Year 3 : 2000 Year 4 : 3000 Year 5 : 50000 2.5 Years 3 Years 3 Years and 10 months 3 Years and 2 months

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Need answer this question

A: Step 1:To find the fair value of an investment that pays a growing annual payment, we can use the…

Q: A project has the following net profit after tax set out below. The average book value of the assets…

A: ARR is one of the capital budgeting tools that can be used by an investor to evaluate a proposed…

Q: Assuming a 1-year, money market account investment at 5.315.31 percent (APY), a 3.413.41 percent…

A: The objective of this question is to calculate the after-tax rate of return, the real rate of…

Q: Return calculations For the investment shown in the following table, calculate the rate of return…

A: Rate of return is calculated as follows:-Rate of return =

Q: Number of years to provide a given return In the information given in following case, determine…

A: Initial amount = $185,500Annual cash flow = $71,963Rate of return = 14%

Q: Fill the correct inputs on the T184 finance application to determine what initial investment would…

A: Given: Future value = $28,000 Interest rate = 2.14% Years = 3

Q: Submit Answer DETAILS The following investment requires table factors for periods beyond the table.…

A: Time value of money is one of useful concept used in finance. It says that amount invested today…

Q: Number of years to provide a given return In the information given in following case, determine the…

A: In an Ordinary Annuity , the cash flow occurs at the end of each fixed period.

Q: 1.Compute the geometric mean (return) and the final balance after 5 years on a $1,500 investment…

A: Geomean The returns an array's or a range of positive data's geometric mean. To determine the…

Q: Consider the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) 0 -$…

Q: What is the fair value of an investment that pays $100 per year in year 1, grows at the rate of 3%…

Q: Compute the payback period for an investment with the following net cash flows. (Round your answer…

A: Years Net cash flows Cumulative Net Cash flows Initial investment ($118,000) ($118,000) 1…

Q: complete the information Annual Deposit Rate of Return Numberr of years Investment Value end of…

A: Please refer to the whiteboard for the calculation of future value of annuity (Investment value at…

Q: Compute the payback period for an investment with the following net cash flows. (Round your answer…

A: >Payback period is the amount of time it will take to get the money invested back. >It is…

Q: A company expects to receive the following cash flows in arrears from a commercial project: Year…

A: Present value:The present value of cash flow is a fundamental financial concept used to determine…

Q: Mountain Brook Company is considering two investment opportunities whose cash flows are provided…

A: Explanation of the Present Value Index:The Present Value Index (PVI) measures the relative…

Q: What is the simple annual rate of return on a $10,000, 3-year investment with cash inflows of $2,000…

A: The simple annual rate of return is calculated by dividing the annual cash flow by the initial…

Q: 22: Find out the capitalized cost of a certain investment based on the following: 1. An initial…

A: Solution- (1)-Initial deposit=100,000(2)Payment every 6 years starting from year 1=10,000 Present…

Q: Give me correct answer

A: Given, First paym nt = $100Growth rate = 3%Required return = 8% Fair value of investment = Required…

Q: Year 1 2 3 4 5 Investment Proposal Book Value $69,900 41,000 21,000 7,600 0 Annual Cash Flows…

A: Annual rate of return = Average annual income / Average investmentNPV = Present value of cash…

Q: Assume that you start with a $1000 dollar invested in each ETF at the end of 2003. Calculate the…

A: Amount invested in IWM is $1,000 Amount invested in EEM is $1,000 Value of EEM in 2019 is 3049.196…

Q: Assuming a 1-year, money market account investment at 2.122.12 percent (APY), a 0.810.81 percent…

A: The objective of the question is to calculate the after-tax rate of return, the real rate of return,…

Q: The investment shown in the following figure has an annual equivalent worthof $200 at i = 8%.…

A: annual worth formula: annual worth=npv ×r1-11+rn

Q: Year Cash Flow (A) Cash Flow (B) 0 −$ 417,000 −$ 36,000 1 48,000 19,600 2 58,000 14,100 3 75,000…

A: The payback period refers to the time it takes a project to recover its initial costs. It does not…

Concept explainers

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.

Question

Calculate the Payback Period using the following Information

All figures are in OMR

Initial Investment = 10000

Cash Flow after Tax(CFAT) are as follows :

Year 1 : 5000

Year 2 : 3000

Year 3 : 2000

Year 4 : 3000

Year 5 : 50000

2.5 Years

3 Years

3 Years and 10 months

3 Years and 2 months

Definition Definition Net amount of cash that an entity receives and expends over the course of a given period. For a business to continue operating, positive cash flows are required, and they are also necessary to produce value for investors. Investors in particular prefer to see growing cash flows even after capital expenditures have been paid for (which is known as free cash flow).

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

What is the payback period for an investment of $10000 with net revenues as follows: year 1: $5000, Year 2: $3000, Year 3: $2000, Year 4: $5000, Year 5: $3000. A. 2 years B. 3 years C. 4 years D. 5 years
Subject :
SOLVE STEP BY STEP IN DIGITAL FORMAT 2. Calculate the amount of the previous problem, if the investment is compounded quarterly. Formulas Compound interest Annual compounding M = C(1+i)n 1 = Cni M = C(1 + i) Fractional capitalization M=C{1+4)*
For each of the investments below, calculate the rate of return earned over the period. Cash Flow During Period - $900 14,000 5,000 70 1,500 (Click on the icon here in order to copy the contents of the data table above into a spreadsheet.) Investment A B C D E Beginning-of-Period End-of-Period Value Value $1,400 140,000 55,000 500 14,000 $400 115,000 49,000 200 12,600
Calculate the following from the information given Fego Ltd:1. Payback Period (expressed in years, months and days).2. Accounting Rate of Return on initial investment (expressed to two decimal places).3. Internal Rate of Return (expressed to two decimal places) if the net cash inflows are R400 000 per year for five years. Your answer must include two net present value calculations (using consecutive rates/percentages) and interpolation.
Assuming a 1-year, money market account investment at 2.282.28 percent (APY), a 1.391.39 percent inflation rate, a 2525 percent marginal tax bracket, and a constant $50 comma 00050,000 balance, calculate the after-tax rate of return, the real rate of return, and the total monetary return. What are the implications of this result for cash management decisions? Question content area bottom Part 1 Assuming a 1-year, money market account investment at 2.282.28% (APY), a 2525% marginal tax bracket, and a constant $ 50 comma 000$50,000 balance, the after-tax rate of return is 1.711.71%. (Round to two decimal places.) Part 2 Assuming a 1-year, money market account investment at 2.282.28% (APY), a 2525% marginal tax bracket, and a constant $ 50 comma 000$50,000 balance, the after-tax monetary return is $855855. (Round to the nearest dollar.) Part 3 Given an after-tax return of 1.711.71% and an inflation rate of 1.391.39%, the after-tax real rate…
solution in excel
Based on the information below, calculate the adjusted present value (APV), given that the project lifespan is 1 year and is being financed by 30% debt: Investment at t=0 € 33,000 Cashflow after yr1 € 39,600 Cost of capital (COC) 53% Cost of debt 43% Tax 33% a) The adjusted present value (APV) is: €-4325.31 b) The adjusted present value (APV) is: €-5307.69 c) The adjusted present value (APV) is: €-7117.65 d) The adjusted present value (APV) is: €-6135.26
Suppose the MARR is 12%. Use the following table to answer the question--The IRR on the CMS Investment is CMS FMS Initial Investment Annual Revenue Useful Life (Years) A. 17.0% - 18.0% B. 20.0% - 21.0% C. 15.0% - 16.0% D. 0.5% -1.0% E. 11.0% - 12.0% $20,000 6,688 15 $29,000 9,102 in 5
Answer ASAP please write the formula used please.
Bha
An investment has the following cash flow series where interest is 8%: a. Determine the present worth of the series. b. Determine the future worth of the series at the end of the 8th year. c. Find the worth of the series at the end of year 2.