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DENIUS [597]
2 years ago
7

Modern Refurbishing Inc. is considering a project that has the following cash flow data. What is the project's IRR? Note that a

project's IRR can be less than the cost of capital (and even negative), in which case it will be rejected.Year 0 1 2 3 4Cash flows −$850 $300 $290 $280 $270a. 13.13%b. 14.44%c. 15.89%d. 17.48%e. 19.22%
Business
1 answer:
IgorLugansk [536]2 years ago
4 0

Answer:

a. 13.13%

Explanation:

Let irr be x%

At irr, present value of inflows = present value of outflows.

850 = 300/1.0x + 290/1.0x^2 + 280/1.0x^3 + 270/1.0x^4

     x = IRR

      = 13.13%

Therefore, The project's IRR is 13.13%

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2 years ago
Myriad Solutions, Inc. issued 12% bonds, dated January 1, with a face amount of $420 million on January 1, 2021, for $375,505,45
faust18 [17]

Calculation

Period   Cash Interest   Bond Interest    Discount     Carrying  

 End          paid            Expense         Amortization     Value

 01-Jan-21                                                            $375,505,452            

30-Jun-21 $25,200,000 $26,285,38 $1,085,382 $376,590,834

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Total    $50,400,000     $52,646,740

3 0
3 years ago
Read 2 more answers
You want to construct a portfolio containing equal amounts of U.S. Treasury bills, stock A, and stock B. If the beta of the stoc
7nadin3 [17]

Answer:

beta of stock B = 1.33

Explanation:

the beta of treasury bills is 0

the beta of stock A = 1.46

the beta of stock B = ?

the portfolio contains equal amounts of each investment and its overall beta is 0.93

0.93 = (0 x 1/3) + (1.46 x 1/3) + (B x 1/3)

0.93 = 0 + 0.4867 + 0.333B

0.93 = 0.4867 + 0.333B

0.4433 = 0.333B

B = 0.4433 / 0.333 = 1.33

4 0
2 years ago
Many companies secure financing from various sources with various payback periods. Not all funding sources are the same, and in
insens350 [35]

Answer and Explanation:

The classification of the funds as a short term or long term strategy as follows;

a. Line of credit = short term financing

b. Commercial paper = short term financing

c. Trade credit = short term financing

d. Bank load of 10 months = short term financing

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f. Stock = long term financing  

g. Bank load of 20 months = long term financing

In this way, the classifications of the funds has to be done

5 0
3 years ago
At the end of a recent​ year, Anderson Cleaning​ Service, a​ full-service house and office cleaning​ service, had total assets o
marysya [2.9K]

Answer:

Anderson Cleaning​ Service's liabilities were $2,160

Explanation:

Basing on accounting equation:

Total asset = Liabilities + Owner's (or Stockholders') Equity

Liabilities = Total asset - Owner's (or Stockholders') Equity

At the end of a recent​ year, Anderson Cleaning​ Service had total assets of $5,810 and equity of $3,650

Anderson Cleaning​ Service's liabilities = Total asset - Equity  = $5,810 - $3,650 = $2,160

7 0
2 years ago
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