Paula bought a machine costing $1,000, which will produce cash inflows of $1,400 over the next 4 years. Determine the payback period given the following cash flows. Year After-Tax Cash Flows Cumulative Cash Flows 1 $400 $400 2 300 700 3 500 1,200 4 200 1,400 a. 2 years b. 2.60 years c. 2.86 years d. 3 years

Paula bought a machine costing $1,000, which will produce cash inflows of $1,400 over the next 4 years. Determine the payback period given the following cash flows. Year After-Tax Cash Flows Cumulative Cash Flows 1 $400 $400 2 300 700 3 500 1,200 4 200 1,400 a. 2 years b. 2.60 years c. 2.86 years d. 3 years

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

ChapterM: Time Value Of Money Module

Section: Chapter Questions

Problem 3MC: Refer to the present value table information on the previous page. If Kathleen put 3,000 in a...

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at the beginning of year one, you have $100,000. Investments A and B are available. Their cash flows are as follows year 1 investment A $-1, investment B $0 Year 2 investment A $.5, investment B $-1. Year three investment A .8 investment B .8. In year 4 investment a .2 investment B .7. Assume that any money not invested in a or B earns interest at an annual rate of 2.5%. Determine how to maximize your cash on hand in your four
Marsiah Crunch plans to deposit cash in her saving account each year as shown below. Her saving effort would be useful as preparation for her son’s education. Year Deposit (RM) 0 1000 1 2000 2 2000 3 2000 4 3000 5 3000 6 3000 (a) Draw a cash flow diagram. (b) Estimate the future worth (FW) at the end of the 10th year based on the investment rate of 8% per annum.
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please show the cash flow diagram and complete given and solution. thank you
Payback and ARR Each of the following scenarios is independent. All cash flows are after-tax cash flows. Required: 1. Brad Blaylock has purchased a tractor for $96,250. He expects to receive a net cash flow of $28,000 per year from the investment. What is the payback period for Jim? Round your answer to two decimal places.fill in the blank 1 years 2. Bertha Lafferty invested $370,000 in a laundromat. The facility has a 10-year life expectancy with no expected salvage value. The laundromat will produce a net cash flow of $120,000 per year. What is the accounting rate of return? Enter your answer as a whole percentage value (for example, 16% should be entered as "16" in the answer box).fill in the blank 2 % 3. Melannie Bayless has purchased a business building for $321,000. She expects to receive the following cash flows over a 10-year period: Year 1: $45,500 Year 2: $62,000 Year 3-10: $87,400 What is the payback period for Melannie? Round your answer to one decimal place.fill…
Bruce is considering the purchase of a restaurant named Hard Rock Hollywood. The restaurant is listed for sale at $1,030,000. With the help of his accountant, Bruce projects the net cash flows (cash inflows less cash outflows) from the restaurant to be the following amounts over the next 10 years: Years Amount 1-6 $ 83,000 (each year) 7 93,000 8 103,000 9 113,000 10 123,000 Bruce expects to sell the restaurant after 10 years for an estimated $1,130,000. (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Use appropriate factor(s) from the tables provided. Round your answer to 2 decimal places.)Required:1-a. Calculate the total present value of the net cash flows if Bruce wants to make at least 10% annually on his investment. (Assume all cash flows occur at the end of each year.) 1-b. Should he purchase the restaurant?
Please step by step answer.
Each of the following scenarios is independent. All cash flows are after-tax cash flows. Required: 1. Michael Kimathi has purchased a tractor for $87,500. He expects to receive a net cash flow of $33,000 per year from the investment. What is the payback period for Michael? Round your answer to two decimal places. 2.65 years 2. Bertha Lafferty invested $362,500 in a laundromat. The facility has a 10-year life expectancy with no expected salvage value. The laundromat will produce a net cash flow of $109,000 per year. What is the accounting rate of return? Enter your answer as a whole percentage value (for example, 16% should be entered as "16" in the answer box). 30 X % 3. Melannie Bayless has purchased a business building for $322,000. She expects to receive the following cash flows over a 10-year period: Year 1: $44,500 Year 2: $62,000 Year 3-10: $81,400 What is the payback period for Melannie? Round your answer to one decimal place. 4.6 years What is the accounting rate of return?…
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In order to accumulate $500,000 after 25 years, calculate the amounts that must be invested at the end of each year, if the invested funds earn: a. 6% compounded annually. (Round your answer to the nearest cent.) PMT $. b. 7% compounded annually. (Round your answer to the nearest cent.) PMT $4 c. 8% compounded annually. (Round your answer to the nearest cent.) PMT $. d. 9% compounded annually. (Round your answer to the nearest cent.) PMT $. In each case, also calculate the total earnings. (Round your answers to the nearest cent.) a. Earnings portion 24 b.Earnings portion c. Earnings portion 24 d. Earnings portion %24 %24
Please include a drawing of cashflow diagram