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
Nezavi [6.7K]
3 years ago
7

The following information is related to Dickinson Company for 2017.

Business
1 answer:
MakcuM [25]3 years ago
3 0

The answer & explanation for this question is given in the attachment below.

You might be interested in
When the market for standalone Global Positioning System (GPS) devices declined with the arrival of GPS-enabled mobile phones, M
Ymorist [56]
Consolidation strategy

(Im not 100% sure)
4 0
3 years ago
Knowledge Check 02 On February 28, the Jewelry store remits $975 of sales tax collected from its customers to the government. Pr
kodGreya [7K]

Answer:

Please refer to the below

Explanation:

Journal entry as seen below

Feb 28 Sales tax payable Dr $975

Cash Cr $975

Since Jewelry store collected the sales tax from its customers, sales tax account will be debited because it reduces the balance in the account while cash account will be credited because the balance therein increases due to the sales tax collected.

7 0
3 years ago
Perit Industries has $135,000 to invest. The company is trying to decide between two alternative uses of the funds. The alternat
Juli2301 [7.4K]

Answer:

1. Net present value of Project A = -41,449.96

2. Net present value of Project B = $143,746.85

3. I would recommend that company accept Project B.

Explanation:

Note: This question is not complete as the requirement are omitted. The requirements are therefore provided to complete the question before answering it as follows:

Perit Industries has $135,000 to invest. The company is trying to decide between two alternative uses of the funds. The alternatives are:

                                                                       Project A           Project B

Cost of equipment required                         $ 135,000                $ 0

Working capital investment required                 $ 0               $ 135,000

Annual cash inflows                                       $ 25,000           $ 63,000

Salvage value of equipment in six years        $ 9,800                $ 0

Life of the project 6 years 6 years

The working capital needed for project B will be released at the end of six years for investment elsewhere. Perit Industries’ discount rate is 17%.

Required:

1. Compute the net present value of Project A. (Enter negative values with a minus sign. Round your final answer to the nearest whole dollar amount.)

2. Compute the net present value of Project B. (Enter negative values with a minus sign. Round your final answer to the nearest whole dollar amount.)

3. Which investment alternative (if either) would you recommend that the company accept?

The explanation of the answers is now provided as follows:

1. Compute the net present value of Project A. (Enter negative values with a minus sign. Round your final answer to the nearest whole dollar amount.)

Cost of equipment required = $135,000

Using the formula for calculating the present value of an ordinary annuity, the present value (PV) of the annual cash inflows can be calculated as follows:

PV of annual cash inflow = Annual cash inflow * (1 - (1 / (1 + discount rate))^Project life) / discount rate) = $25,000 * ((1 - (1 / (1 + 0.17))^6) / 0.17) = $89,729.62

The present value (PV) of the salvage value can be calculated as follows:

PV of salvage value = Salvage value / (1 + + discount rate)^Project life = $9,800 / (1 + 0.17)^6 = $3,820.42

Net present value of Project A = PV of annual cash inflow + PV of salvage value - Cost of equipment required = $89,729.62 + $3,820.42 - $135,000 = -41,449.96

2. Compute the net present value of Project B. (Enter negative values with a minus sign. Round your final answer to the nearest whole dollar amount.)

Working capital investment required = $135,000

Using the formula for calculating the present value of an ordinary annuity, the present value (PV) of the annual cash inflows can be calculated as follows:

PV of annual cash inflow = Annual cash inflow * (1 - (1 / (1 + discount rate))^Project life) / discount rate) = $63,000 * ((1 - (1 / (1 + 0.17))^6) / 0.17) = $226,118.64

The present value (PV) of the Working capital investment required can be calculated as follows:

PV of Working capital investment required = Working capital investment required / (1 + + discount rate)^Project life = $135,000 / (1 + 0.17)^6 = $52,628.21

Net present value of Project B = PV of annual cash inflow + PV of Working capital investment required - Working capital investment required = = $226,118.64 + $52,628.21 - $135,000 = $143,746.85

3. Which investment alternative (if either) would you recommend that the company accept?

From parts 1 and 2 above, we have:

Net present value of Project A = -41,449.96

Net present value of Project B = $143,746.85

Since the Net present value of Project A is negative, it should be rejected.

Since the Net present value of Project B is positive, it should be accepted.

Therefore, I would recommend that company accept Project B.

6 0
3 years ago
Why do you think it is important to choose the correct Business organization
dexar [7]

Not choosing the correct business organization to set up would become very costly for an individual hoping to start operations and this would result in business failure even before the business began operations.

3 0
3 years ago
According to a recent study, offering low-cost offices with basic services to new businesses in the early stages of development
OverLord2011 [107]

The study shows that offering of low-cost offices with basic services to new businesses in the early stages of development brings about a 87% success rate of <u>incubator</u><u>.</u>

<u />

<u />

<h3>Who does the Incubators entails?</h3>

The Incubators is a tool that offer a new businesses in the critical stage of early development low-cost offices with basic services such as accounting, legal advice, secretarial help etc

In conclusion, the study shows that offering of low-cost offices with basic services to new businesses in the early stages of development brings about a 87% success rate of <u>incubator</u><u>.</u>

<u />

<u />

Read more about incubator

<em>brainly.com/question/13714458</em>

3 0
2 years ago
Other questions:
  • Many financial decisions require the analysis of uneven,or nonconstant: cash flows stock dividends typically increase over time
    7·1 answer
  • Straw men approaches to business ethics are used to demonstrate
    9·1 answer
  • Other things equal, if there is an increase in nominal GDP, bond prices will rise. the interest rate will rise. consumption spen
    12·1 answer
  • The rate of economic growth per capita in france from 1996 to 2000 was 1.9% per year, while in korea over the same period it was
    6·1 answer
  • Using the supply and demand for loanable funds model, explain why the central bank may aggressively expand the monetary base.
    5·1 answer
  • During the 1920s, competition increased and businesspeople realized they had to do more than just focus on manufacturing, which
    9·1 answer
  • Starting an investment portfolio at a young age means
    8·1 answer
  • To be valid and enforceable, insurance contracts must meet which general legal requirements?
    12·1 answer
  • Aubey Aircraft recently announced that its net income increased sharply from the previous year, yet its net cash flow from opera
    7·1 answer
  • Annual Percentage Rate (APR), credit limit, and penalties
    15·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!