The costs would be treated as sunk cost or an opportunity cost . Introduction: Sunk cost: Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions. Opportunity cost: It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

Question

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Answer 1

Question

Chapter 11, Problem 11.5P

a)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

b)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

c)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

d)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

e)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

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General Finance Question

Consider the following simplified financial statements for the Yoo Corporation (assuming no income taxes): Income Statement Balance Sheet Sales Costs $ 40,000 Assets 34,160 $26,000 Debt Equity $ 7,000 19,000 Net income $ 5,840 Total $26,000 Total $26,000 The company has predicted a sales increase of 20 percent. Assume Yoo pays out half of net income in the form of a cash dividend. Costs and assets vary with sales, but debt and equity do not. Prepare the pro forma statements. (Input all amounts as positive values. Do not round intermediate calculations and round your answers to the nearest whole dollar amount.) Pro forma income statement Sales Costs $ 48000 40992 Assets $ 31200 Pro forma balance sheet Debt 7000 Equity 19000 Net income $ 7008 Total $ 31200 Total 30304 What is the external financing needed? (Do not round intermediate calculations. Negative amount should be indicated by a minus sign.) External financing needed $ 896

Answer 2

Question

Chapter 11, Problem 11.5P

a)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

b)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

c)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

d)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

e)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

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Answer 3

Question

Chapter 11, Problem 11.5P

a)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

b)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

c)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

d)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

e)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

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Answer 4

Question

Chapter 11, Problem 11.5P

a)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

b)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

c)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

d)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

e)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

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Answer 5

Chapter 11, Problem 11.5P

a)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

b)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

c)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

d)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

e)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

Answer 6

Chapter 11, Problem 11.5P

a)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

Answer 7

Chapter 11, Problem 11.5P

a)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

Answer 8

b)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

Answer 9

b)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

Answer 10

c)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

Answer 11

c)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

Answer 12

d)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

Answer 13

d)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

Answer 14

e)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

Answer 15

e)

Summary Introduction

To explain: The costs would be treated as sunk cost or an opportunity cost.

Introduction:

Sunk cost:

Cost which has been incurred and cannot be removed. These are costs that are excluded from the future business decisions.

Opportunity cost:

It is the cost missed by an individual, investor or a firm when they select an alternative over the another.

Answer 16

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Answer 17

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Answer 18

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Answer 19

Ch. 11.1 - Prob. 1FOE Ch. 11.1 - Prob. 11.1RQ Ch. 11.1 - What three types of net cash flows may exist for a...Ch. 11.1 - Prob. 11.3RQ Ch. 11.1 - Prob. 11.4RQ Ch. 11.1 - Prob. 1GF Ch. 11.2 - Explain how to use each of the following inputs to...Ch. 11.2 - Prob. 11.6RQ Ch. 11.2 - Prob. 11.7RQ Ch. 11.2 - Prob. 11.8RQ

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