1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
wolverine [178]
3 years ago
6

Norman Co. wants to purchase a machine for $40,000, but needs to earn an 8% return. The expected year-end net cash flows are $12

,000 in each of the first three years, and $16,000 in the fourth year. What is the machine's net present value (round to the nearest whole dollar)?
Business
1 answer:
umka21 [38]3 years ago
7 0

Answer:

Year      Cashflow    [email protected]%           PV                    

                   $                                  $                                                                                                                    

0                (40,000)     1              (40,000)                                                                                                                                                                                                    

1                   12,000      0.9259      11,111      

2                  12,000      0.8573       10,288

3                  12,000      0.7938        9,526                                                                                                                                    

4                  16,000      0.7350        <u>11,760</u>

                                             NPV   <u> 2,685</u>

<u />

Explanation:

Net present value is the difference between present value of cash inflows and initial outlay. The present value of cash inflows were obtained by multiplying the cash inflows by discount factors.                                                                                                                                                                                                                                                            The discount factors were calculated  using the formula (1 + r)-n,  where n represents number of years and r denotes discount rate.                                      

You might be interested in
Barney hendricks is interviewing web developers for his company. over lunch, he tells you that his top candidate showed lots of
anastassius [24]
Barney appears to be very impressed by the candidate's non-verbal communication skills.
8 0
3 years ago
Read 2 more answers
You want to buy a car. Your parents will pay for half of the car if you save enough money for the other half. You have chosen th
Tema [17]

Answer: 12 months

Explanation:

Let's assume I want to get a 2007 Volkswagen Jetta $12,000, which has a very good review. I'll need to save for 12months to get $6000 then add $6000 which would be given to me by my parents, at the end of 12months I would be able to get the 2007 Volkswagen Jetta which goes for $12,000.

4 0
3 years ago
Indicate whether the following actions would increase, decrease, or not affect Indigo Inc.'s total assets, liabilities, and stoc
Elenna [48]

Explanation:

The effects are as follows:

a. In the first option, there is No effect in any item of the financial statements

b. In the second option, there is  No effect in any item of the financial statements

c. In the third option, there is No effect in any item of the financial statements

d. No impact on the assets but it increases the liabilities side and decreases the stockholder equity

The journal entry is shown below:  

Retained earning A/c Dr  XXXXX

    To Dividend payable  A/c XXXXX

(Being cash dividend declared)  

When the dividend is declared, the dividend amount should be subtracted from the retained earning account.  

And, since the dividend is declared that increases the balance of dividend

In addition, the dividend payable and the retained earning account have a credit balance. The increase in dividend payable account would have credit balance whereas the decrease in retained earning account has a debit balance.  

e. Paying the cash dividend declared in (d)        

The journal entry is shown below:

Dividend payable A/c XXXXX

           To Cash A/c XXXXX

(Being the cash dividend is paid)

Since it reduces the liabilities and the asset side also but it does not have any impact on the stockholder equity

7 0
3 years ago
Most job leads are discovered through _______.
mina [271]
The correct answer is A
!
6 0
3 years ago
Diamond Computer Company has been purchasing carrying cases for its portable computers at a purchase price of $59 per unit. The
Gemiola [76]

Answer:

<u>Part(a) Differential analysis as at February 24</u>

Make (Alternative 1) :

Direct Materials                             $35.00

Direct labor                                    $18.00

Variable Overheads                      $2.70

Fixed Overheads                           $0.00

Total Make Costs                         $55.70

Buy (Alternative 2) :

Total Purchase Cost                    $59.00

<u>(b) On the basis of the data presented, would it be advisable to make the carrying cases or continue buying them? </u>

It is clear that from comparison of the cost of Purchase and the Cost of Making the Carrying Cases, the Cost of Making the Carrying Cases is lower than the Cost of Purchasing the Cases by $3.30

It is thus advisable to make carrying cases instead of buying them

Explanation:

Total Make Costs;

The Factory fixed overheads are irrelevant to this decision hence they were ignored in the make cost calculations.

5 0
3 years ago
Other questions:
  • In the united states the process of mate selection is essentially random <br> a. True <br> b. False
    5·1 answer
  • Which of the following statements are true regarding dividends?
    11·1 answer
  • What is the defintion of liquidity ​
    9·2 answers
  • Stutz Department Store will buy 10 pairs of sunglasses if the price is $93 per pair and 30 pairs if the price is $43. The suppli
    10·1 answer
  • Debt is frequently incurred when plant assets are acquired. For example, debt may be incurred on the purchase of plant assets. D
    10·1 answer
  • Calculate the selling price per unit charged by the outside supplier that would make ABC Company economically indifferent betwee
    12·1 answer
  • When evaluating special offer decisions, management should consider: (Check all that apply.) Multiple select question. historica
    14·1 answer
  • If there are 3 spots on an employment application to list references, how many references do you need to list?
    6·1 answer
  • A full outer join with the matching rows removed is known as a ______________.
    15·1 answer
  • As a consumer consumes more of a good or service, the additional satisfaction of consuming the additional units goes down. This
    5·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!