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Irina-Kira [14]
2 years ago
14

In​ 2019, BayKing Company sold used equipment for $ 21 comma 000. The equipment had an original cost of​ $80,000 and accumulated

depreciation as of the date of sale was​ $60,000. BayKing also purchased heldminustominusmaturity securities for $ 10 comma 000. Net income for the year was​ $74,000. There were no other transactions conducted during the period. What are the net investing cash flows for​ BayKing?
Business
1 answer:
Mamont248 [21]2 years ago
3 0

Answer:

$11,000

Explanation:

The cash flow statement categories the company's transactions in a financial period into 3 groups; these are operating, investing and financing.

The net profit/loss, depreciation, changes in current assets (other than cash) and liabilities are considered as operating activities including income taxes.  

The sale of assets, interest received, purchase of investments are examples of investing activities while the issuance of stocks, debt principal deduction (loan settlement), issuance of debt securities etc are examples of financing activities.

An increase in assets other than cash is an outflow while an increase in liabilities is an inflow. Depreciation and other non-cash expenses deducted in the income statements are added back while the non-cash income such gain on asset are deducted from net income.

net investing cash flows

= $21,000 - $10,000

= $11,000

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What is the npv of the following cash flows if the required rate of return is 0.14? year 0 1 2 3 4 cf -4,506 3,099 531 3,560 2,7
aksik [14]

-$177.62, CF0 = -28900, CO1 = 12,450 FO1 = 1, CO2 = 19,630 FO2 = 1, CO3 = 2,750 FO3 = 1I = 12, CPT NPV = -177.62

In practical terms, it is a method of calculating your return on investment, or ROI, for a project or expenditure. Net present value may be a tool of Capital budgeting to research the profitability of a project or investment.

it's calculated by taking the difference between the current value of money inflows and present value of money outflows over a period of your time. Put differently, it's the compound annual return an investor expects to earn (or actually earned) over the lifetime of an investment.

for instance, if a security offers a series of money flows with an NPV of $50,000 and an investor pays exactly $50,000 for it, then the investor's NPV is $0. Net present value uses discounted cash flows within the analysis, which makes the web present value more precise than of any of the capital budgeting methods because it considers both the danger and time variables.

A higher NPV doesn't necessarily mean a far better investment. If there are two investments or projects up for decision, and one project is larger in scale, the NPV are higher for that project as NPV is reported in dollars and a bigger outlay will lead to a bigger number. Net present value (NPV) is that the difference between this value of money inflows and also the present value of money outflows over a period of your time.

learn more about NPV: brainly.com/question/18848923    

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6 0
1 year ago
You are considering two investment alternatives. The first is a stock that pays quarterly dividends of $0.32 per share and is tr
MrMuchimi

Answer:

The 1-year HPR for the second stock is <u>12.84</u>%. The stock that will provide the better annualized holding period return is <u>Stock 1</u>.

Explanation:

<u>For First stock </u>

Total dividend from first stock = Dividend per share * Number quarters = $0.32 * 2 = $0.64

HPR of first stock = (Total dividend from first stock + (Selling price after six months - Initial selling price per share)) / Initial selling price = ($0.64 + ($31.72 - $27.85)) / $27.85 = 0.1619, or 16.19%

Annualized holding period return of first stock = HPR of first stock * Number 6 months in a year = 16.19% * 2 = 32.38%

<u>For Second stock </u>

Total dividend from second stock = Dividend per share * Number quarters = $0.67 * 4 = $2.68

Since you expect to sell the stock in one year, we have:

Annualized holding period return of second stock = The 1-year HPR for the second stock = (Total dividend from second stock + (Selling price after six months - Initial selling price per share)) / Initial selling price = ($2.68+ ($36.79 - $34.98)) / $34.98 = 0.1284, or 12.84%

Since the Annualized holding period return of first stock of 32.38% is higher than the Annualized holding period return of second stock of 12.84%. the first stock will provide the better annualized holding period return.

The 1-year HPR for the second stock is <u>12.84</u>%. The stock that will provide the better annualized holding period return is <u>Stock 1</u>.

6 0
3 years ago
Eric has plans to go to a play and already has a $50 nonrefundable, nonexchangeable, and nontransferable ticket. Now Ginny, whom
KengaRu [80]

Answer:

Correctly ignored a sunk cost.

Explanation:

In economics a sunk cost is one that an individual has already paid for and cannot recover. For example when payment is made for rent it is no longer recoverable.

In this instance Eric has already bought a $50 ticket that is nonrefundable, nonexchangeable, and nontransferable. This is a sunk cost.

Eric wants to go to the concert with Ginny who he wanted to date for a long time.

He will correctly ignore the sunk cost of going to the play because any more time spent on the play will not help recover the $50 already spent.

7 0
2 years ago
you wish to buy a $25,000 car. the dealer offers you a 4-year loan with a 9 percent apr. what are the monthly payments?
NeTakaya

In order to buy a car worth $25,000 a monthly payment of $622.12 is required.

Mortgages are one type of loan that frequently has a structure that calls for a stream of identical monthly payments. The lender can assess whether the customer's budget can support equal monthly payments by doing so.

Suppose the monthly payment is M.

With 9 percent APR, the effective monthly rate is 9%/12 = 0.75%.

There will be 12 x 4 years, or 48 monthly payments.

The face value of the loan must be equal to the present value of these monthly payments, or

{}\sum_{t=1}^{48}{\frac{M}{(1 + 0.75\%)^t}} = 25,000, {}

which yields M = 622.12.

If you only paid interest, the monthly payment would be calculated as follows: principal * monthly interest rate (9% /12) = 25,000*0.75% = 187.5.

The results would be that after five years, you would still owe the whole amount of $25,000 and would have to pay $11,250 in interest.

Learn more about loans:

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4 0
10 months ago
If real income rises from $5 trillion to $6 trillion while the price level increases by 10 percent, it follows that nominal inco
AVprozaik [17]

The nominal income will increase with the increase in the real income.

<u>Explanation:</u>

Real income of the person is the buying or the purchasing capacity of the person. It is the nominal income adjusted for inflation. If there is an increase in the real income more than the increase in the level of the prices at a particular period of time, it means that the level of nominal income of the person will also increase.

7 0
2 years ago
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