Fabulous Fabricators needs to decide how to allocate space in its production facility this year. It is considering the following contracts:a. What are the profitability indexes of the projects?b. What should Fabulous Fabricators do?Data table(Click on the following icon in order to copy its contents into a spreadsheet.)ContractANPV$1.98 millionUse of Facility100%B$1.01 million57%C$1.49 million43%PrintDone- X☑

To solve this, we need to calculate the profitability index (PI) for each contract and then…

Answered: Fabulous Fabricators needs to decide…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter12: Balanced Scorecard And Other Performance Measures

Section: Chapter Questions

Problem 11MC: Dixon Construction Materials has collected this information: Based on this Information, what is the...

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Objective: Should WAW lease or construct their own production facilityOption 1: ConstructCosts to incur:Buying land, construct building and getting ready for use$ 230,000Taxes, insurance, and repairs (per year)$ 30,000Intended years of use20Projected market value in 20 years$ 1,600,000Maximum down payment WAW can make$ 500,000Remainder in four payments of;$ 180,000Option 2: LeaseIntended years of use20First lease payment due now$ 100,000Rest of the lease payments (years 2-20)$ 90,000Operating costs to be paid by WAWRepairs (annual)$ 7,000Maintenance (annual)$ 25,000Initial one-time deposit, will be returned in year 20$ 40,000Required rate of return15%Methodology:The consulting team is proposing to perform a NPV analysis and determine the benefit to leasing or construction.Based on the analysis, they will recommend the preferred option (construction or leasing).
Laurman inc. is considering the following project: Please provide excel formulas for all answers
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Should WLW lease or construct their own production facilityOption 1: ConstructCosts to incur:Buying land, construct building and getting ready for use$ 360,000Taxes, insurance, and repairs (per year)$ 34,000Intended years of use20Projected market value in 20 years$ 1,600,000Maximum down payment WLW can make$ 500,000Remainder in four payments of;$ 160,000Revenue opportunityBuilding annex will be leased to a tenant and will generate a lease revenue (per year) for 10 years$60,000Option 2: LeaseIntended years of use20First lease payment due now$ 90,000Rest of the lease payments (years 2-20)$ 90,000Operating costs to be paid by WLWRepairs (annual)$ 9,000Maintenance (annual)$ 26,000Initial one-time deposit, will be returned in year 20$ 40,000Required rate of return15%Methodology:The consulting team is proposing to perform a NPV analysis and determine the benefit to leasing or construction.Based on the analysis, they will recommend the preferred option (construction or leasing).
Provide answer
analysis Your program office has just completed of the latest Contract Performance Report on its Cost Plus Fixed Fee contract with Truman Inc. The original estimated cost of the contract is $300 million and the fixed fee is $15 million. The following information is available: "Best Case" EAC = $295 million "Most Likely" EAC = $310 million "Worst Case" EAC = $348 million Which one of the following represents the best estimate of the funding requirements for the Truman Inc. contract?
Can you solve the question step by step and explain which formulas you use?
of stion Given the following information about projects A and B: Project A Project B -10,000 -10,000 4,000 3,000 10,000 Time 0 Time 1 Time 2 Time 3 If alpha company uses IRR rule to choose projects, which of the projects (Project A or Project B) will rank highest? Select one: O O O 5,000 4,000 3,000 a. Project A b. Project B c. Project A and Project B have the same ranking. d. Cannot calculate a payback period without a discount rate.
1. Celebrity Food is evaluating the kale crisper project. During year 1, the kale crisper project is expected to have relevant revenue of $400,000, relevant variable costs of $125,000, and relevant depreciation of $40,000. In addition, Celebrity Food would have one source of fixed costs associated with the kale crisper project. Celebrity Food just signed a deal with Lights Camera Action to develop an advertising campaign for use in the project. The terms of the deal require Celebrity Food to pay Lights Camera Action either $80,000 in 1 year if the project is pursued or $110,000 in 1 year if the project is not pursued. Relevant net income for the kale crisper project in year 1 is expected to be $200,000.calculate is the tax rate expected to be in year 1? Answer in decimal format, rounded to the nearest hundredth of a percent (for example, 1.23% would be entered as 0.0123). 2. What is the net present value of the flier project, which is a 3-year project where Dispersion would spread…
A piece of production equipment is to be replaced immediately because it no longer meets quality requirements for the end product. The two best alternatives are a used piece of equipment (E1) and a new automated model (E2). The economic estimates for Alt E1 Alt E2 Capital Investment PhP 14,000 PhP 65,000 Aппual Expenses 14,000 9,000 each are shown in the accompanying table. Useful Life (years) 5 20 Market Value (at the end of useful life) 8,000 13,000 The MARR is 15% per year. Which alternative is preferred, based on the (a) coterminated assumption with a five-year study period and an imputed market value for Alternative b? Use FW. ANSWER: FW (E1) = PhP Blank 1 FW (E2) = PhP Blank 2 The best alternative is EBlank 3
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