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Andreyy89
3 years ago
8

Bau Long-Haul, Inc., is considering the purchase of a tractor-trailer that would cost $283,215, would have a useful life of 7 ye

ars, and would have no salvage value. The tractor-trailer would be used in the company's hauling business, resulting in additional net cash inflows of $85,500 per year. The internal rate of return on the investment in the tractor-trailer is closest to (Ignore income taxes.):
Click here to view Exhibit 13B-1 and Exhibit 13B-2, to determine the appropriate discount factor(s) using the tables provided.

Garrison 16e Rechecks 2017-11-11

Multiple Choice

23%

16%

19%

14%
Business
1 answer:
Anarel [89]3 years ago
8 0

Answer:

IRR is 23%

Explanation:

We must find the IRR which, when applied to the formula (attached), is equal to zero:.

As we can see, if we apply a rate (r) of 23%, the result of the formula will be zero. Consequently, this is the value of the IRR.

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You might be interested in
Connolly Company produces two types of lamps, classic and fancy, with unit contribution margins of $13 and $21, respectively. Ea
Eva8 [605]

Answer:

a. 90,000 classic lamps; 0 fancy lamps

Explanation:

To determine the optimise total contribution, we need to calculate the contribution margin per hour of machine time for both the lamps. Then the result of whichever is higher would be produced.

Moreover, as there is no limitation on how many lamps can be produced, therefore, we would assume that we can make as many as we want up to the limit of machine-hours available. The calculation is done as follows:

Contribution margin per hour of machine time for classic lamp = Contribution/machine hours to build one classic lamp

Contribution margin per hour of machine time for classic lamp = 13 / 0.2

Contribution margin per hour of machine time for classic lamp = 65

Contribution margin per hour of machine time for fancy lamp = Contribution/machine hours to build one fancy lamp

Contribution margin per hour of machine time for fancy lamp = 21 / 0.5

Contribution margin per hour of machine time for fancy lamp = 42

Since classic lamp has the higher contribution margin per hour. Therefore, all the machine hours would be used to make classic lamps.

= 18,000 / 0.2

= 90,000

Hence, 90,000 classic lamps would be sold while no fancy lamps will be sold to optimise total contribution (which would be 65 x 18,000 = $1,170,000).

7 0
3 years ago
Damian invests $5,000 today in an account earning 6% per year. How much is the investment worth in 4 years?
sp2606 [1]

Based on the fact that Damien invested $5,000 and left it in an account that earns 6% for 4 years, the investment worth would be b. $6,312.38.

<h3>What would be the value of the investment?</h3>

The value of the investment in 4 years is considered to be its future value when looking at it from the present.

Using the rate being earned, the investment amount, and the number of years the investment will be invested, the future value formula is:

Future value = Investment x ( 1 + rate)^ number of years

Solving gives:

= 5,000 x ( 1 + 0.06) ⁴

= 5,000 x 1.06⁴

= 5,000 x 1.26247696

= $6,312.3848

= $6,312.38

In conclusion, the value of Damien's investment after a period of four years at 6% per year comes to $6,312.38.

Find out more on future value at brainly.com/question/24703884

#SPJ1

7 0
1 year ago
What commodity has the united states recently focused on producing domestically?
amm1812
The united states is recently focused on producing domestically the energy. In addition, when negotiating economic policy, the united states diplomats usually seek to reduce trade barriers. The critique of united states economic policy is free trade can harm the environment because other countries may not have environmental regulations in place. 
5 0
3 years ago
Read 2 more answers
The adjusting entry to adjust supplies was omitted at the end of the year. This would affect the income statement by having expe
creativ13 [48]

Answer:

This would affect the income statement by having expenses

c. understated and therefore net income overstated revenues

Explanation:

Adjusting Entry:

It is such entry which is added at the end of the fiscal period in order to make the income statement accurate.

Overstated:

In Accounting, overstated amount means that amount is greater than the true amount.

Understated:

In Accounting, if an amount is less than the true amount then it is known as understated.

  • As in our case, the adjusting entry for supplies was not added so in this way expenses became understated means they become less as compared to actual expenses. Therefore, revenues overstated.

5 0
3 years ago
Read 2 more answers
Equilibrium is defined as:
Mamont248 [21]
<span>The answer is d. quantity demanded equals quantity supplied</span>
5 0
3 years ago
Read 2 more answers
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