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nexus9112 [7]
3 years ago
9

Phillips industries runs a small manufacturing operation. for this fiscal year, it expects real net cash flows of $197,000. the

company is an ongoing operation, but it expects competitive pressures to erode its real net cash flows at 6 percent per year in perpetuity. the appropriate real discount rate for the company is 11 percent. all net cash flows are received at year-end. what is the present value of the net cash flows from the company's operations?
Business
1 answer:
Stolb23 [73]3 years ago
8 0

Answer: Present value of the cash flows of the company is $1,158,824.

Explanation: Philips industries have the cash flow for $197,000. The industry needs to find the present value of the cash flow and the cash flows growth is decreasing every year by 6%.

The present value of the cash flows for perpetuity with decreasing growth rate is:

Present value = Cash flow for year 1 (C1) / (discount rate - growth)

where, Cash flow for the year 1 (C1) = $197,000

Discount rate (r) = 11%

Growth rate (g) = -6%

Present value of the cash flows (PV) = $197000/[0.11 - (-0.060)]

Present value of the cash flows (PV) = $197000/0.17

Present value of the cash flows (PV) = $1,158,824

Therefore the present value of the cash flows of the company is $1,158,824.

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Answer:

The correct words for the blank spaces are: are low-risk investments; are high-risk investments.

Explanation:

Bonds are considered to be <em>low-risk investments </em>compared to stocks because an interest rate fixed payment is made with bonds in regular periods. Instead, stocks are <em>high-risk investment</em>s since they payout dividends to stakeholders based on a company's profits implying investors will only earn a profit if the company has been able to earn income during a period. Even if that happens, the firms can retain the earnings for reinvestment.

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Answer:

The answer is: B) $24,000

Explanation:

This type of exchange is classified as a like-kind exchange (1031 exchange); it is a transaction that allows a company to dispose an asset and acquire another replacement asset without generating a tax liability from the sale of the replaced asset.

$40,000 (replacement asset) + $4,000 (cash paid) - $20,000 (replaced asset) = $24,000

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6 0
3 years ago
At an appliance store, the price of a refrigerator is marked up 25% to $406. 25. What was the price of the refrigerator before t
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The price of the refrigerator before markup will be $325. This can be calculated by reversing the markup in the price of the refrigerator.

<h3>What is Markup?</h3>

Markup basically refers to the difference between the selling price of a good and its cost. The markup is generally expressed as a percentage and is added to the cost of the good to ensure cost cover and earn profit.

For the given question, the before markup price can be calculated as:

Given:

\rm \:\:After\: markup\:price = \$406.25\\\\Markup\:percentage\:\: = 25\%

Makeup is the addition to the original price of a good. The after markup price can be taken as 100% + 25% = 125% of original price.

Then original price can be calculated as:

\rm x = \$406.25 \times \dfrac{100}{125}\\\\x = \$325

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brainly.com/question/5189512

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3 years ago
Doreen Schmidt is a chemist. She needs to prepare 24 ounces of a 11​% hydrochloric acid solution. Find the amount of 12​% soluti
Degger [83]

Answer:

20 ounces of 12% solution and 4 ounces of 6% solution.

Explanation:

Let x be the quantity ( in ounces ) of 12% solution that is mixed with y quantity ( in ounces ) of 6% solution to obtain 24 ounces of 11% solution,

∵ Quantity of resultant solution = 24 ounces

⇒ x + y = 24

⇒ x = 24 - y ------(1)

Also, 12% of x + 6% of y = 11% of 24

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From equation (1),

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Again from equation (1),

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Hence, 20 ounces of 12% solution and 4 ounces of 6% solution should mix to get this solution.

8 0
3 years ago
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