Answer:
The correct option is B. 9200.
Explanation:
This can simply be answered as follows:
.................. (1)
Where:
= Weighted moving average forecast (0.4, 0.3, 0.3) for Week 6 = ?
= Week 5 demand = 11,000
= Week 4 demand = 9,000
= Week 3 demand = 7,000
The (0.4, 0.3, 0.3) implies that:
= Weight of Week 5 demand = 0.4
= Weight of Week 4 demand = 0.3
= Weight of Week 3 demand = 0.3
Substituting all the relevant values into equation (1), we have:
= (11,000 * 0.40) + (9,000 * 0.30) + (7,000 * 0.30) = 9,200
Therefore, the correct option is B. 9200.
Answer: $545,000
Explanation:
Using the indirect method of formatting the Cash flow statement, the cash from operating activity is:
= Net income + Depreciation + Loss on sale of depreciable asset + Patent amortization expense + Accounts receivable decrease + Wages payable increased - Accounts payable decrease - Prepaid assets increased - Unearned revenue decrease
= 500,000 + 53,000 + 31,000 + 5,000 + 41,000 + 19,000 - 42,000 - 31,000 - 31,000
= $545,000
Answer:
The answer is: Leslie should fund projects A and C
Explanation:
In order to determine if a project should be accepted, the first thing Leslie has to do is determine the projects´ Net Present Value (NPV). If the NPV is 0 or more, then the projects could be funded.
The formula to calculate NPV is:
NPV = ∑{p/( 1+r)t} - C
- p = net cash flows from the period
- r = discount rate (8.5% in this case)
- t = number of periods
- c = capital invested
<u>Project A:</u>
p = $4000;$4000;$4000
r = 8.5%
t = 3
c = $7,500
The NPV for Project A is $2,716.09
<u>Project B:</u>
p = $3000;$4000;$3000
r = 8.5%
t = 3
c = $8,000
The NPV for Project B is $511.52
<u>Project C:</u>
p = $0;$2,500
r = 8.5%
t = 2
c = $2,000
The NPV for Project C is $123.64
Once you calculate the NPVs from projects A,B and C you must determine how to distribute the $15,000 available. All three projects have positive NPVs, so they are profitable. But you can´t fund projects A and B since their combined costs ($7,500 + $8,000 = $15,500) exceeds $15,000. Leslie should invest in project A since its NPV is higher ($2,716.09 ˃ $511.52). She should also fund project C since its NPV is positive ($123.64) and the capital needed is smaller (only $2,000).