Answer:
$81.52
Explanation:
To determine the price of the stock, one has to calculate the present value of the stock.
The present value is the sum of discounted cash flows.
Present value can be calculated using a financial calculator
Cash flow in year 1 = $3
Cash flow in year 2 = $4.25
Cash flow for year 3 = $100 + $6 = $106
I = 12 %
Present value = $81.52
The price one would pay for the stock today is $81.52
To find the PV using a financial calacutor:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. After inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.
3. Press compute
I hope my answer helps you
Answer:
If we assumes we setup machine for product A x times, and B y times, the total hours required is 0.5*3000 + 0.8*2000+ 2*x + 8 *y = 3100+2x+8y. Notice that due to the capacity restriction x has to be no smaller than 150 hours (3000/20) and y has to be no smaller than 50 hours (2000/40). so total required hours must exceed 3100+2*150+8*50=3800. The management prefer a 15% capacity cushion, which means the total duration prepared for the processing should be at least 3800*(1+15%)=4370 hours.
If one machine operates eight hours per day, five days per week and 50 weeks a year, it operates 5*8*50 = 2000 hours in total.
That's why we need 2 more machines ( 3 machines in total since 4370 > 2*2000).
Answer:
$37,455
Explanation:
The unit of production method of depreciation charges higher amounts of depreciation seasons of higher output. The depreciation amount is propositional to the level of production.
The formula applicable in the calculation of the unit of depreciation is as follows.
Depreciation = depreciable value / estimated production value x units produced
For this machine: depreciable value = Asset cost - residual value
Depreciable value =$264,970- $14500 = $250, 470
Estimated units to be produced = 759,000 bolts
Units produced in the second year =113,500
Depreciation for the second year
= 250, 470/ 759,000 x 113,500
=0.33 x 113, 500
= $37,455
Jack is making an assumption while john is making a believable excuse
