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Vanyuwa [196]
3 years ago
9

Computer Consultants Inc. is considering a project that has the following cash flow and cost of capital (r) data. What is the pr

oject's MIRR? Note that a project's MIRR can be less than the cost of capital (and even negative), in which case it will be rejected.r = 10.00%Year 0 1 2 3Cash flows −$1,000 $450 $450 $450a. 9.32%b. 10.35%c. 11.50%d. 12.78%e. 14.20%
Business
1 answer:
Marina86 [1]3 years ago
5 0

Answer:

e. 14.20%

Explanation:

We use the formula:

A=P(1+r/100)^n

where

A=future value

P=present value

r=rate of interest

n=time period.

Hence

A=$450(1.1)^2+$450(1.1)^1+$450

=$450[(1.1)^2+(1.1)+1]

=$1489.50

Hence

MIRR=[Future value of inflows/Present value of outflows]^(1/time period)-1

=[1489.5/1000]^(1/3)-1

=14.20%(Approx)(E).

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Stone Culture Corporation was organized on January 1, 2017. For its first two years of operations, it reported the following:
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Answer:

             Statement of retained earnings

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Retained earnings, January 1, 2017              $0

Add: Net Income                                         $54,000  

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3 years ago
Feldpausch Corporation has provided the following data from its activity-based costing system:
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Answer:

Product margin per unit= $7.2

Explanation:

Giving the following information:

Activity Cost Pool Total Cost Total Activity

Assembly $ 1,137,360 84,000 machine-hours

Processing orders $ 28,479 1,100 orders

Inspection $ 97,155 1,270 inspection-hours

First, we need to calculate the estimated overhead rate for each activity cost pool:

To calculate the estimated manufacturing overhead rate we need to use the following formula:

Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Assembly= 1,137,360/84,000= $13.54 per machine hour

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We will calculate the total cost of production and then the unitary cost to determine the product margin:

Total cost= direct material + direct labor + allocated overhead

The company makes 470 units of product W26B a year, requiring a total of 660 machine-hours, 50 orders, and 40 inspection-hours per year. The product's direct materials cost is $40.30 per unit and its direct labor cost is $42.22 per unit. The product sells for $118.00 per unit.

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