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tatiyna
3 years ago
9

Smart Solutions Inc. is evaluating a capital project for expansion. The project costs $10,000, and it is expected to generate $5

,000 per year for three years. If the firm's required rate of return is 10 percent, what is the project's terminal value?
Business
1 answer:
Likurg_2 [28]3 years ago
4 0

Answer:

d) $16,550

Explanation:

First, The multiple options to the question

a)$12,500

b) $11,550

c) $14,050

d) $16,550

e) $15,000

Question: To determine the terminal value of the project

What do we know:

The Cash flow from the project is $5,000 per year and the rate is 10%

To determine the future value per year is as follows

Year 1 = (1+r)∧2= (1+0.1)∧2= 1.21

Year 2 = (1+r)∧1= (1+0.1)∧1= 1.1

Year 3 = (1+r)∧0= (1+0.1)∧0= 1

Based on these determinations, we determine the yearly value as follows

Year 1= 5,000 (1.21) = $6,050

Year 2 = 5,000 (1.1)= $5,500

Year 3= 5,000 (1) -= $5000

The terminal value = The total of the three years

= $6,050 + $5,500 + $5,000

= $16,550

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Answer:

$534,600

Explanation:

<em>Contribution margin = Sales - Variable Costs</em>

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Variable Costs = Costs of Goods Sold + Variable Selling Costs + Variable Administrative Cots

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therefore,

Contribution margin = $1,792,800 - $1,258,200 = $534,600

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2 years ago
What are the disadvantages of using social media to evaluate candidates for a job opening? Check all that apply
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Answer:

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Explanation:

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This is the importance of the culture of a company. The series of values, principles, mission, and vision that characterizes and makes the company unique. Every single employee in the company shares these values and can be transmitted through time to new workers. "Parker Legends" is a tradition that is respected and is part of the organization's DNA.

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3 years ago
Company Earnings per Share Market Value per Share 1 $ 11.00 $ 176.00 2 8.00 78.40 3 6.00 77.40 4 35.00 203.00 Compute the price-
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Answer:

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Explanation:

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2 years ago
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Answer:

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