Dimitra is projecting cash flows for her firm using the percentage of sales method. She projects that the sales will be growing at 4% per year from the current level of $1M (year 0). She also projects a constant $20K per year in depreciation for the next 5 years. The firm's Net PPE currently stands at $200K. What should be her forecast for Capital Investment in year 3? O $44K O $29K $20K $8K O $39K
Dimitra is projecting cash flows for her firm using the percentage of sales method. She projects that the sales will be growing at 4% per year from the current level of $1M (year 0). She also projects a constant $20K per year in depreciation for the next 5 years. The firm's Net PPE currently stands at $200K. What should be her forecast for Capital Investment in year 3? O $44K O $29K $20K $8K O $39K
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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![Dimitra is projecting cash flows for her firm using the percentage of sales method. She projects that the sales will be growing at 4% per year
from the current level of $1M (year 0). She also projects a constant $20K per year in depreciation for the next 5 years. The firm's Net PPE
currently stands at $200K. What should be her forecast for Capital Investment in year 37
$44K
O
$29K
$20K
O $8K
O
$39K](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fd3138f06-94d5-4129-864a-b6eca9163d38%2Fa0721b88-e52b-4b17-a15f-07b2a84189da%2Feoushk_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Dimitra is projecting cash flows for her firm using the percentage of sales method. She projects that the sales will be growing at 4% per year
from the current level of $1M (year 0). She also projects a constant $20K per year in depreciation for the next 5 years. The firm's Net PPE
currently stands at $200K. What should be her forecast for Capital Investment in year 37
$44K
O
$29K
$20K
O $8K
O
$39K
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