Please provide answer the accounting question only experts answer excepted The Western and Pacific Railroad has two divisions, the WesternDivision and the Pacific Division. The company recently invested$8,000,000 to maintain its railroad track. Pertinent data for thetwo divisions are as follows:Total miles traveled:Western Division: 800,000 milesPacific Division: 1,200,000 milesThe amount of risk improvement cost that should be allocatedto the Western Division is: (Do not round your intermediatecalculations.)a. $4,000,000.b. $3,200,000.c. $800,000.d. $5,333,333.

Step 1:Cost allocation is a method of allocation of overhead cost to respective departments,…

Answered: The Western and Pacific Railroad has…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter11: Capital Budgeting And Risk

Section: Chapter Questions

Problem 11P

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Consider a project with the following information: Initial fixed asset investment = $540,000; straight-line depreciation to zero over the 4-year life; zero salvage value; price = $52; variable costs = $33; fixed costs = $222,000; quantity sold = 112,000 units; tax rate = 21 percent. How sensitive is OCF to changes in quantity sold?
Laurman inc. is considering the following project: Please provide excel formulas for all answers
Consider a three-year project with the following information: initial fixed asset investment = $710,000; straight-line depreciation to zero over the 5-year life; zero salvage value; price = $39.39; variable costs = $28.31; fixed costs = $332,000; quantity sold = 87,000 units; tax rate = 24 percent. How sensitive is OCF to changes in quantity sold? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) AOCF/AQ
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The management of FICSIT Inc. is considering two capital investment projects. The estimated net cash flows from each project are as follows:YearWind TurbinesBiofuel Equipment1$270,000$300,5002270,000300,5003270,000300,5004270,000300,500The wind turbines require an investment of $877,600, while the biofuel equipment requires an investment of $910,000. No residual value is expected from either project.Problem 2 Instructions a. Determine the internal rate of return for each project by:i. computing a present value factor for an annuity of $1 and ii. using the present value of an annuity of $1 table appearing in this chapter (Exhibit 5).
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