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Vitek1552 [10]
4 years ago
14

Parker & Stone, Inc., is looking at setting up a new manufacturing plant in South Park to produce garden tools. The company

bought some land 10 years ago for $5 million in anticipation of using it as a warehouse and distribution site, but the company has since decided to rent these facilities from a competitor instead. If the land were sold today, the company would net $9.6 million. The company wants to build its new manufacturing plant on this land; the plant will cost $15.2 million to build, and the site requires $960,000 worth of grading before it is suitable for construction.
What is the proper cash flow amount to use as the initial investment in fixed assets when evaluating this project?
Cash Flow amount $ _____
Business
1 answer:
love history [14]4 years ago
4 0

Answer:

$25,760,000

Explanation:

The net amount of decrease and increase of cash a business or individual owns.

To find the proper cash flow amount used as the initial investment in fixed assets, use the following:

Calculation of initial investment outflow = cost of land + cost of plant + grading cost

= $9,600,000 + 15,200,000, + $960,000

= $25,760,000

Calculation of initial investment outflow = $25,760,000

Therefore the initial investment outflow is $25,760,000

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At a bakery, which of the following operating characteristics might result in economies of scale? A Each oven requires one worke
MA_775_DIABLO [31]

Answer:

C. A giant mixing container costs twice as much to operate as a small one but can mix 6 times as much dough daily

Explanation:

Economies of scale refers to a state when increase in the output results out of lower average costs. The operation of such a phase results out of, the total cost getting spread over large number of units of production in the long run.

Economies of scale results when the operations of a business expand due to which a firm can buy in bulk, avail more discounts and concessions from the seller for inputs and the efficiency of the labor rises.

In the given case, if the bakery decides to purchase a giant mixing container, it might lead to economies of scale given the fact, with respect to costs, the revenues shall rise more.

Since the giant mixer is capable of mixing six times as much dough daily, it would lead to a reduction in the average cost accompanied by an increase in the output and thereby lead to economies of scale.

6 0
4 years ago
FARO Technologies, whose products include portable 3D measurement equipment, recently had 36 million shares outstanding trading
erma4kov [3.2K]

Answer:

A. $117 million

B.13%

C. $21.75

Explanation:

B. Calculation to determine How large a loss in dollar terms will existing FARO shareholders experience on the announcement date

Expected Loss= 390*30%

Expected Loss= $117 millions

Therefore How large a loss in dollar terms will existing FARO shareholders experience on the announcement date will be $117 millions

B. Calculation to determine What percentage of the value of FARO’s existing equity prior to the announcement is this expected gain or loss

First step is to calculate the Existing Shares Value

Existing Shares Value =36*$25

Existing Shares Value= $900 millions

Now let calculate the Expected Loss %

Expected Loss % = $ 117/$ 900

Expected Loss % = 13%

Therefore the percentage of the value of FARO’s existing equity prior to the announcement is this expected gain or loss will be 13%

C. Calculation to determine At what price should FARO expect its existing shares to sell immediately after the announcement

Price Per Share: $ 25*(1 - 0.13)

Price Per Share$25*0.87

Price Per Share: $21.75

Therefore what price should FARO expect its existing shares to sell immediately after the announcement is $21.75

6 0
3 years ago
Assume that at the current market price, a perfectly competitive firm's profit-maximizing level of output yields total revenues
wlad13 [49]

Answer:

c. The firm is earning zero economic profit and should continue to operate.

Explanation:

This is because at that point firm has not earned any profit or facing a loss.

6 0
3 years ago
Telephone companies and electric utilities were among the last businesses to start actively using public relations.
melomori [17]

Answer:

your answer would be false

hope this helps

:)

6 0
3 years ago
Read 2 more answers
I want to study accounting at levels 2 and 3. What can you offer me in my choice of subjects? Would this come under 'Business'?
gladu [14]

Answer:Yes.

Explanation:The only accounting you will ever do unless it's private for yourself is going to be for a business learning how they work can help you.

3 0
4 years ago
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