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Crank
4 years ago
14

Northfield Casino is considering converting the Polsky Building at University of Akron into a state-of-the-art gaming parlor. Th

is expansion project will require an initial outlay of $75,000,000 with a project life of five years. Cash flows from operating the new parlor are expected to be $25,000,000 every year for the next five years. The parlor will be sold for $50,000,000 at the end of five years. The project's required rate of return, or discount rate is 18%. Based on this information: The project's payback period is:______.
a. 2.25 Years.
b. 2.5 Years.
c. 2.75 Years.
d. 3 Years.
e. 3.2 Years.
Business
1 answer:
Maurinko [17]4 years ago
4 0

Answer:

d. 3 Years.

Explanation:

Payback period calculates the amount of time it takes to recover the amount invested in a project from its cumulative cash flows.

Payback period = amount invested / cash flow

$75,000,000 / $25,000,000 = 3 years

I hope my answer helps you

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Weston Corporation just paid a dividend of $3.75 a share (i.e., D0 = $3.75). The dividend is expected to grow 9% a year for the
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Answer:

D1 = $4.085

D2 = $4.46

D3 = $4.86

D4 = $5.01

D5 = $5.16

Explanation:

As per the data given in the question,

DO = $3.75

Dividend expected to grow = 9%

Dividend grow later = 4%

D1 = DO(1+ Dividend1) = $3.75(1+9%)  

=$3.75(1.09)

=$4.085

D2 = DO(1+ Dividend1 )( 1 + Dividend2)

= $3.75(1+9%)(1+9%)

= $4.46

D3 = DO(1+Dividend1)(1+Dividend2)(1+Dividend3)

= $3.75(1+9%)(1+9%)(1+9%)

= $4.86

D4 = DO(1+Dividend1)(1+Dividend2)(1+Dividend3)(1+Dividend later)

= $3.75(1+9%)(1+9%)(1+9%)(1+3%)

= $5.01

D5 = DO(1+Dividend1)(1+Dividend2)(1+Dividend3)(1+Dividend later)(1+Dividend later)

= $3.75(1+9%)(1+9%)(1+9%)(1+3%)(1+3%)

= $5.16

5 0
4 years ago
If you were seeking an entity with the most favorable tax treatment regarding (1) the number of owners allowed, (2) the flexibil
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Explanation: You should use a C corporation, which refers to the corporations it pays as a separate subject from its owners.

Under this type of entity will have a more favorable treatment in terms of the number of owners, benefits when selling their participation and flexibility about the selection of accounting periods.

8 0
3 years ago
In the market for gasoline, if the change in demand due to the start of the summer driving season is greater than the change in
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3 years ago
In the financial industry, "securitization" refers to
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3 0
4 years ago
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Answer:

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According to the scenario, Journal entry of the given data are as follows:

Journal entry

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