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
Over [174]
3 years ago
11

(Ignore income taxes in this problem.) Clairmont Corporation is considering the purchase of a machine that would cost $150,000 a

nd would last for 5 years. At the end of 5 years, the machine would have a salvage value of $18,000. By reducing labor and other operating costs, the machine would provide annual cost savings of $37,000. The company requires a minimum pretax return of 12% on all investment projects.
The present value of the annual cost savings of $37,000 is closest to:________.
a) $133,385
b) $235,070
c) $185,000
d) $20,979
Business
1 answer:
djverab [1.8K]3 years ago
4 0

Answer:

a) $133,385 

Explanation:

Present value is the sum of discounted cash flows.

Present value can be calculated using a financial calculator:

Present value each year from year 1 to 5 = $37,000

I = 12%

NPV = $133,385 

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

You might be interested in
Difference between private and public company
djyliett [7]

<span>The difference between a privately-held and public company is that the owners of the private company are the company’s founders or a group of private investors while in the public company, the company has undergone an initial public offering that means the company sold a portion of its shares to the public. The management of a public company is answerable to the shareholders as opposed to the private company. A public company sells the shares of stock and is listed in the stock exchange while a private company is unlisted. </span>

6 0
3 years ago
It is better to evaluate economic decisions at the marginal, where the decision has to be made as long as its marginal benefit e
Wittaler [7]

Answer: True

Explanation:

Marginal benefit is the maximum amount that a consumer will be willing to pay for an extra product. It should be known that as consumption rises, the marginal benefit starts reducing.

The marginal cost is the extra cost that a producer incurs when an extra unit of a product is made. Economic decisions made by economic agents are typically based on marginal as it'll be possible to know the impact of an extra decision made on a variable.

Therefore, it is better to evaluate economic decisions at the marginal, where the decision has to be made as long as its marginal benefit exceeds its marginal cost, if not equal to its marginal cost.

4 0
4 years ago
Capital structure decisions include determining: Multiple Choice which one of two projects to accept. how to allocate investment
Serjik [45]

Answer:

The correct answer is how much debt should be assumed to fund a project.

Explanation:

The first thing that must be specified is that a company can be leveraged through debt, contributions from partners or equity, and that the relationship between these two variables will be the capital structure of the company. In addition, one could say that success comes with more certainty to a company that evaluates different possibilities in which these two forms of leverage come into play.

The term optimal structure, in finance, includes the close relationship that exists between the costs and benefits that may be the product of different forms of leverage. One of the points that financial advisors take into account to measure such relationship are the tax advantages that an entrepreneur can acquire when making financial decisions and the decisions he makes regarding the leverage he wishes to obtain.

The following are some of the aspects that are evaluated when looking for an optimal capital structure:

  • Financing costs can be high as a result of the company neglecting its good name before the financial sector; In case the company does not comply with the business hypothesis underway or has a bad habit of payment, it can lead to high interest rates and unfavorable conditions or, in the worst case, close the doors in the financial sector.
  • Having a good payment capacity and a good habit of timely payment will be key when requesting a loan, not only for obtaining the credit itself, but because you can obtain proposals from different financial institutions and take advantage of the best rates and benefits.
  • The portfolio purchase options are always a good ally to improve the cash flow of the organization, to take advantage of this it is necessary to evaluate the rate, term and additional conditions that this new financing includes.
  • The company must find that different transactions are not restricted in the contracts it makes with third parties. Having to subject the activity to the clauses imposed by suppliers or allies, can cause you to miss the opportunity to take advantage of other businesses.
  • The agency theory and the moral hazard problem is something that must be taken care of very carefully, since the level of autonomy that the administrator has in the company can jeopardize the offer of value that the investor expects to receive. There have been cases in which the bad decisions of the administration, whether due to errors or fraud, have caused bankruptcy cases or penalties.

In reality, an optimal capital structure is found when investors obtain a significant value offer, that is, that the earnings per share –UPA– are greater, and when financial leverage is used without exceeding market risk levels, but it should also be clarified that all this varies according to the economic conditions of the country and the sector in which the company is located. Finally, it goes without saying that supporting the evaluation of decisions through different financial indicators makes it possible to make a more accurate decision in all cases.

4 0
3 years ago
Cullumber Company has a unit selling price of $650, variable costs per unit of $450, and fixed costs of $319,800. Compute the br
saveliy_v [14]

Answer:

(a)

Mathematical Equation for break-even

F = QP - QV

Where

F = fixed cost

Q = Break-even quantity

P = Selling price

V = Variable cost

F = Q ( P - V )

Q = F / ( P - V )

Q = $319,800 / ( $650 - $450 )

Q = $319,800 / $200

Q = 1,599 units

(b)

Contribution Margin = Price per unit - Variable cost per unit

Contribution Margin = $650 - $450 = $200

Break-even Point in Units = Fixed Cost / Contribution margin per unit

Break-even Point in Units = $319,800 / $200 = 1,599 units

Explanation:

Mathematical equation use the the break-even equation which represent the behavior of each element towards the break-even point.

Contribution per unit method use the contribution of each unit to calculate the break-even point.

4 0
3 years ago
Which tasks does the stock control specialist perform before the unit arrives at the asp?
spin [16.1K]

Check the TEC, ensure that a valid DA Form 1687 is on file for the unit,

screen the Overdue Document list tasks does the stock control specialist perform before the unit arrives at the asp.

<h3>What are ASP personnel responsible for?</h3>

Ammunition Supply Point (ASP) are responsible for receiving, storing and issuing all class V ammunitions required to support all TRADOC, FORSCOM and SOCOM units/activities assigned to the installation, as well as US Army Reserves and US Army National Guard units from Georgia, Alabama and Florida.

They inspect boxes and containers and calculate quantity based on brass weight.

Once residue is turned in, residue personnel properly stores and ships residue according to the ASP's SOP and Army procedures.

To learn more about ASP, refer

brainly.com/question/24607535

#SPJ4

6 0
2 years ago
Other questions:
  • What's the best thing for someone to learn when first investing in stocks. Can I still make a profit with not alot of money. Whe
    5·1 answer
  • Shirley Macuga is the world’s fastest typist and is also a world famous brain surgeon. She earns $5,000/hour operating on brains
    8·1 answer
  • Gloria Rose works at College of Austin and is paid $ 30 per hour for a​ 40-hour workweek and​ time-and-a-half for hours above 40
    7·1 answer
  • Economic profits are:a.less than accounting profits if implicit costs are greater than zero.b.less than accounting profits even
    11·1 answer
  • Tara works as a senior manager at TechWin Software Inc. As part of her improvement program, she asked her team members to state
    14·1 answer
  • Jared's boss encourages employees to participate in the decision-making process but does not give them complete freedom to do as
    6·1 answer
  • During a company's first year, the asset account, Office Supplies, was debited for $3,900 for the purchases of supplies. At year
    11·1 answer
  • Calculate the end of the year cash balance based on the information below:
    11·1 answer
  • A company's value chain Multiple choice question. is not analytically useful if it is a non-manufacturing company. includes only
    13·1 answer
  • Carlyle called economics the dismal science after reading the early work of.
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!