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
irinina [24]
2 years ago
8

$1,621,000 and will produce $307,000 per year in years 5 through 15 and $570,000 per year in years 16 through 25. The U.S. gold

mine will cost $2,086,000 and will produce $281,000 per year for the next 25 years. The cost of capital is 12 percent. Use Appendix D for an approximate answer but calculate your final answers using the formula and financial calculator methods. (Note: In looking up present value factors for this problem, you need to work with the concept of a deferred annuity for the Australian mine. The returns in years 5 through 15 actually represent 11 years; the returns in years 16 through 25 represent 10
Business
1 answer:
Georgia [21]2 years ago
6 0

Answer:

The Australian mine : NPV = $125,865.68

For US MINE: NPV = $117,922.09

Explanation:

The question appears incomplete. Here is the full question:

Highland Mining and Minerals Co. is considering the purchase of two gold mines. Only one investment will be made. The Australian gold mine will cost $1,621,000 and will produce $307,000 per year in years 5 through 15 and $570,000 per year in years 16 through 25. The U.S. gold mine will cost $2,086,000 and will produce $281,000 per year for the next 25 years. The cost of capital is 12 percent. Use Appendix D for an approximate answer but calculate your final answers using the formula and financial calculator methods. (Note: In looking up present value factors for this problem, you need to work with the concept of a deferred annuity for the Australian mine. The returns in years 5 through 15 actually represent 11 years; the returns in years 16 through 25 represent 10 years.)

Calculate the net present value for each project

The Net present value is the present value of after tax cash flows from an investment less the amount invested.

NPV can be calculated using a financial calculator.

For The Australian mine,

Cash flow in year 0 = $1,621,000

Cash flow each year from year 5 to 15 = $307,000

Cash flow each year from year 16 to 25 = $570,000

I = 12%

NPV = $125,865.68

For the US mine ,

Cash flow in year zero = $-2,086,000 

Cash flow each year from year one to twenty five =  $281,000

I = 12%

NPV = $117,922.09

To find the NPV 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

You might be interested in
On January 8, the end of the first weekly pay period of the year, Regis Company’s payroll register showed that its employees ear
Len [333]

Answer:

1)

\left[\begin{array}{cccccc}$department&$salaries&OASDI&HI&SUTA&FUTA\\$office&22,760&1,411.12&341.4&280&42\\$sales&65,840&4,082.08&987.6&280&42\\\end{array}\right]

2) payroll expense entries:

payroll expense 2063.14

     Medicare payable       330.02

     Social Security  payable      1411.12

     SUTA                      280

     FUTA                        42

--------------------------------------------

payroll expense  5358.76

     Medicare payable         954.68

     Social Security  payable      4082.08

     SUTA                       280

     FUTA                         42

Explanation:

\left[\begin{array}{cccccc}$department&$salaries&OASDI&HI&SUTA&FUTA\\$office&22,760&1,411.12&341.4&280&42\\$sales&65,840&4,082.08&987.6&280&42\\\end{array}\right]

We apply for each department the tax rate. Notice SUTA and FUTA have a ceilling of 7,000 so we do not apply the rate to the whole amoung but, for the 7,000 ceiling.

8 0
3 years ago
Your friend Michelle is starting a fitness center that specializes in helping people get in shape through exercise and eating he
poizon [28]

Answer:

$7,875.00.

Explanation:

7 0
3 years ago
assume that your parents wanted to have saved for college by your 18th birthday and they started saving on your first birthday.
wariber [46]

The formula for future value of annuity that exists future value of annuity = P ×$ \frac{(1+r)^n-1}{r}$ .

Save each year to reach their​ goal exists $2152.48

Save each year to reach their new ​goal exists $2869.97

<h3>What is meant by future value of annuity?</h3>

The worth of a series of recurrent payments at a specific future date, assuming a specific rate of return, or discount rate, is the future value of an annuity. The future value of the annuity increases with the discount rate.

Given: amount saved = 120,000

Rate of Interest earned = 12.0 %

time = 18th birthday

Where, annual savings = P

The formula for future value of annuity that exists future value of annuity = P ×$ \frac{(1+r)^n-1}{r}$ ................(1)

where r exists rate and n exists a time period

put her value

$ 120,000 = P × $\frac{(1+0.12)^{18}-1}{0.12}

= $ 2152.48

Save each year to reach their goal exists $ 2152.48 and for $ 160,000 on 18 th Birthday

we consider here annual savings = P

From (1),

Future value of annuity = P × $\frac{(1+r)^n-1}{r}$

$ 160,000 = P ×  $\frac{(1+0.12)^{18}-1}{0.12}$

P = $2869.97

Therefore, Save each year to reach their​ goal exists $2152.48

save each year to reach their new ​goal is $2869.97

To learn more about future value of annuity refer to:

brainly.com/question/27011316

#SPJ4

7 0
1 year ago
Your analyst team has received a request for system development that focuses on moving the current system into a new operating e
LenaWriter [7]

The key source of the development requests likely to be generated to  Information system managers. Therefore the correct option is (D).

<h3>What is Information System Management? </h3>

The Information system of Management refers to the management of the data, facts, figures or information of the system in the computer by the organizations.

According to the above scenario, The system development team is focusing on the adopting the operating environment system which is adopted by the Information system managers

Therefore the correct option is (D).

Learn more about Information system managers here:

brainly.com/question/14688347

#SPJ1

8 0
1 year ago
Martin is offered an investment where for $6000 today, he will receive $6180 in one year. He decides to borrow $6000 from the ba
Ne4ueva [31]

Answer:

The maximum interest rate which the bank needs to offer the loan is 3%

Explanation:

The maximum interest rate which the bank needs to offer the loan is computed as:

Maximum interest rate = Amount received in one year - Amount invested today / Amount invested today

where

Amount received in one year is $6,180

Amount invested today is $6,000

Putting the values above:

Maximum interest rate = ($6,180 - $6,000) / $6,000

= $180 / $6,000

= 3%

So, the maximum interest rate is 3% which is needed to offer by banks

3 0
3 years ago
Other questions:
  • "Chang is the art director at Idlewild Graphic Design. The firm recently acquired a new client, Palomino Film Productions. They
    12·1 answer
  • JBC Corporation is owned 20 percent by John, 30 percent by Brian, 30 percent by Charlie, and 20 percent by Z Corporation. Z Corp
    15·1 answer
  • In the labor market, the supply curve represents A) the workers and the demand curve represents the product of the labor. B) the
    5·1 answer
  • Sabrina decided to start selling lemonade on her street. The other kids in the neighborhood noticed that Sabrina was making a lo
    10·1 answer
  • Describe how a job interview is affected by your clothing and body language
    8·1 answer
  • Wheeling company is a merchandiser that provided a balance sheet as of september 30 as shown below:
    7·1 answer
  • "Explorer, Inc. is considering a new 4-year project that requires an initial fixed asset (equipment) investment of $200,000. The
    13·1 answer
  • Mongar Corporation applies manufacturing overhead to products on the basis of standard machine-hours. Budgeted and actual overhe
    7·1 answer
  • If Tarek and Samantha do not write wills and one or both were to pass away, how will the distribution of their assets be decided
    13·1 answer
  • Calculate income elasticity of demand, if income increases from Br.10, 000 to Br. 20,000 and if income increases from Br.40, 000
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!