proposal to reduce oil spill on MX5 has a B-C ratio of 1.5. The conventional annual worth of benefits is P560,000 and the lisbenefits is P100,000. What is the first cost of the project if the interest rate is 6% per year and the project is expected to have a CO-year life? ANSWER: Blank 1 Blank 1 Add your answer

proposal to reduce oil spill on MX5 has a B-C ratio of 1.5. The conventional annual worth of benefits is P560,000 and the lisbenefits is P100,000. What is the first cost of the project if the interest rate is 6% per year and the project is expected to have a CO-year life? ANSWER: Blank 1 Blank 1 Add your answer

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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4 Compute the payback statistic for Project B if the appropriate cost of capital is 12 percent and the maximum allowable payback period is three years. (If the project never pays back, then enter a "O" (zero).) Project B Time: 1 2 3 4 5 Cash nts $3,470 $4,420 $1,760 $0 $1,240 flow: $12,200 Payback Print years eferences Should the project be accepted or rejected? асcepted O rejected
Compute the payback statistic for Project A if the appropriate cost of capital is 7 percent and the maximum allowable payback period is four years. (Round your answer to 2 decimal places.) Project A Time: 0 1 2 3 4 5 Cash flow: −$1,100 $390 $510 $540 $320 $120 Should the project be accepted or rejected?multiple choice accepted rejected
Salalah Wind Energy has taken up a new project with an initial investment of 50000 OMR.The expected future cashflow from the project over the next three years will be 22500 OMR, 23500 OMR and 24500 OMR.What is the profitability index if the discount rate is 7 percent? Select one: a. 1.48 b. 1.44 c. 1.63 d. 1.23 e. None of these
Question It is expected that a 2-year term project will generate revenues of $5 million at the end of the second year. Costs and expenses are fixed at $3 million at thc end of the first year. You are also given that the risk-free rate is 3% and the market risk premium is 5.5%. Determine the project's beta if the revenues have a beta of 1.15. Possible Answers A Less than I At least 1 but less than 2 C At least 2 but less than 3 D At least 3 but less than 4 At least 4
> Investment A costs $10,000 today and pays back $11,500 two years from now. Investment B costs $8,000 today and pays back $4,500 each year for two years. If an interest rate of 5% is used, which alternative is superior? Mark the correct answer within the multiple-choice alternatives below. a. Alternative A b. Alternative B
You must decide firm which of the proposed projects should be accepted for the upcoming year since only $6 million is available. Which projects should be accepted? Project Cost (millions) NPV(millions) A 3.25 0.80 В 1.75 0.52 C 4.5 0.69 D 3.75 0.95 E 1.25 0.25 F 0.50 0.25
A Moving to another question will save this response. Question 20 Solar Energy is currently examining a project that will produce cash inflows of $21,405 a year for two years followed by $12.390 in year 3. The cost of the project is $38,716. What is the profitability index of the project if the discount rate is 11 percent? A Moving to another question will save this response. O Type here to search
Coffer Company is analyzing two potential investments. Project X Cost of machine Net cash flow: Year 1 Year 2 $ 85,470 Project Y $ 65,000 33,000 33,000 3,000 30,000 Year 3 Year 4 33,000 0 • 30,000 25,000 If the company is using the payback period méthod, and it requires a payback period of three years or less, which project(s) should be selected? Multiple Choice Project Y. Project X. Both X and Y are acceptable projects. Neither X nor Y is an acceptable project.
A firm evaluates all of its projects by applying the NPV decision rule. A project under consideration has the following cash flows: Year 0 1 2 WN 3 NPV Cash Flow What is the NPV for the project if the required return is 12 percent? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) -$ 29,000 13,000 16,000 12,000 At a required return of 12 percent, should the firm accept this project? NPV Yes O No What is the NPV for the project if the required return is 24 percent? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
You are offered the chance to participate in a project that produces the following cash flows: C0 C1 C2 +$ 5,000 +$ 4,000 −$ 11,000 The internal rate of return is 13.6%. If the opportunity cost of capital is 12%, what is the net present value of the project? Note: Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to 2 decimal places.
4. If the terminal balance of a 5-year project at 10% s0 then which one below is true? A. The IRR of the project is less than 10% B. The future worth of the project is greater than 0 C. Discounted payback perlod is 5 years OD. The present worth of the project is less than 0 5 In an incremental IRR analysis, which analysis period should be used to compare 2 mutually altemative projects with 3 and 4 years of useful lives? (Assume an indefinite analynis perlod and that the projects are repeatable) O A. B years O B. 12 years OC. 4 years D. 3 years
7 Compute the payback statistic for Project A if the appropriate cost of capital is 9 percent and the maximum allowable payback period is four years. (Round your answer to 2 decimal places.) Project A ts Time: 1 2 3 4 5 Cash flow: -$2,400 $910 $900 $800 $580 $380 Print Payback years ferences Should the project be accepted or rejected? аccepted rejected