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Ulleksa [173]
3 years ago
8

Michigan Mattress Company is considering the purchase of land and the construction of a new plant. The land, which would be boug

ht immediately (at t = 0), has a cost of $100,000 and the building, which would be erected at the end of the first year (t = 1), would cost $500,000. It is estimated that the firm's after tax cash flow will be increased by $100,000 starting at the end of the second year, and that this incremental flow would increase at a 10 percent rate annually over the next 10 years. What is the approximate payback period? 2 years 4 years 6 years 8 years 10 years
Business
1 answer:
swat323 years ago
8 0

Answer:

6 years

Explanation:

The Payback period calculates how much it takes the amount invested in a project to be recovered from the cumulative cash flow.

Total amount invested =  $500,000 +  $100,000 =  $-600,000

Cash inflow in year 2 =  $100,000

Amount recovered in year 2 = $-600,000 + 100,000 = $-500,000

Cash inflow in year 3 =  $100,000 × 1.1 = 110,000

Amount recovered in year 3=$-500,000 + 110,000 = $-390,000

Cash inflow in year 4= $121,000

Amount recovered in year 4 = $-390,000 + $121,000 = $-269,000

Cash inflow in year 5= $133,100

Amount recovered in year 5 = $-269,000 + $133,100 = $-135,900

Cash inflow in year 6 = $146,410

Amount recovered in year 6 = $146,410 $-135,900 = $10,510

The amount is recovered In 5.93 years

I hope my answer helps you

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As the manager of a golf resort, you want to increase the number of tee times sold by 10 percent. Your staff economist (and juni
Luden [163]

Answer:

The price of tee times needs to be decreased by 6.67%.

Explanation:

The manager wants to increase the number of tee times sold by 10 percent.

The price elasticity of demand for tee times is –1.5.

Percentage change in price of tee times to increase the demand by 10%

Price elasticity of demand = \frac{\% \Delta Q}{\% \Delta P}

-1.5 = \frac{10 \%}{\% \Delta P}

\% \Delta P = \frac{10}{-1.5}\% \Delta P = -6.67 \%

7 0
3 years ago
Tigger was terminated from the local ice cream shop as the staff manager. He did not manage by example including being rude to c
Lisa [10]

He failed at Human Resources functional area of management

Let understand that the functional area of management is the section of management of a firm which ensures that the important business activities are carried out efficiently.

The functional area of management is distinctively categorized into 6 part and they includes:

  1. Strategic area of management
  2. Marketing area of management
  3. Finance area of management
  4. Human resources area of management
  5. Technology & equipment area of management
  6. Operations area of management

In conclusion, the area that Tigger failed at is the Human Resources area because he need to serves as a good example for his Subordinate as well as effectively manage them, whereas, he failed at it.

Learn more about functional area of management here

<em>brainly.com/question/14594002</em>

6 0
3 years ago
ABC Corporation distributes property to its sole shareholder, Andre. The property has a fair market value of $350,000, an adjust
saul85 [17]

Answer:

ABC has a gain of $145,000 and Andre's dividend income is $130,000

Explanation:

Property ABC issued, has the following:

fair market value = $350,000

Adjusted basis = $205,000

Liability = $220,000

Calculate ABC's Corporation gain:

Gain = market value - Adjusted basis

= $350,000 - $205,000

= $145,000

ABC has a gain of $145,000

Calculate Andre's dividend income since he is the sole shareholder:

Dividend earnings = fair market value - liability

= $350,000 - $220,000

= $130,000

Andre's dividend income is $130,000

Correct option is D.

With respect to distribution, ABC has a gain of $145,000 and Andre's dividend income is $130,000

8 0
3 years ago
Most goods and services produced at home a. and most goods and services produced illegally are included in GDP. b. are included
katen-ka-za [31]

Answer:

Most goods and services produced at home are included in GDP while most goods and services produced illegally are excluded from GDP.

Explanation:

The United states Gross Domestic Product is measured including only the production of legal goods and services within a given year. This means that all goods and services for previous year are not taken into account as well of illegal products or services.

7 0
3 years ago
Read 2 more answers
Zoey Bella Company has a payroll of $9,440 for a five-day workweek. Its employees are paid each Friday for the five-day workweek
Ratling [72]

Answer:

Dr Salaries expense $7,552

Cr Accrued salaries $7,552

Being entries to record salaries payable as at year end

Explanation:

When an expense is incurred but yet to be paid by an organization, the entries required are

Dr Expense (p/l)

Cr Accrued expense (B/s)

when payment is made

Dr Accrued expense (B/s)

Cr Cash account

Given that Zoey Bella Company has a payroll of $9,440 for a five-day workweek and the year ends on a Thursday. As such, the company  as at 31 December has incurred salaries for 4 days. This has to be accrued for but first to calculate the amount

= 4/5 * $9,440

= $7,552

Hence adjusting entry required on December 31, assuming the year ends on a Thursday

Dr Salaries expense $7,552

Cr Accrued salaries $7,552

Being entries to record salaries payable as at year end

7 0
2 years ago
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