Answer:
$2007.6
Explanation:
According to the scenario, computation of the given data are as follow:-
4th Year Cash Flow = Salvage Value + Expected End Year Net Cash Flow
= $1,200 + $11,300
= $12,500
Year Cash flow ($) PVF at 8% Present value ($)
0 36,300 1.000 -36,300
1 11,300 0.9259 10462.67
2 11,300 0.8573 9687.49
3 11,300 0.7938 8969.94
4 12,500 0.7350 9187.5
Net present value 2007.6
According to the analysis, net present value of machine is $2007.6
Answer:
(a) $1.73
(b) 12.74
(c) 5.80
Explanation:
Given that,
Sales revenue = $670,000
Cost of goods sold = 390,000
Gross profit = 280,000
Expenses = 180,000
Net income = $100,000
Interest expense = $25,000
Income tax expense = $20,000
(a) Earnings per share:
= (Net income - Preferred dividend) ÷ Weighted average common stock
= ($100,000 - $5,000) ÷ 55,000
= $95,000 ÷ 55,000
= $1.73
(b) Price-earnings:
= Stock price ÷ Earnings per share
= $22 ÷ $1.73
= 12.74
(c) Income before interest and taxes:
= Net income + Interest expense + Income taxes
= $100,000 + $25,000 + $20,000
= $145,000
Times interest earned:
= Income before interest and taxes ÷ Interest expenses
= $145,000 ÷ $25,000
= 5.80
Answer:
An investment is acceptable if its AAR exceeds a target AAR.
Explanation:
The average accounting return (AAR) is a capital budgeting decisions method that is obtained by dividing the earnings after taxes and depreciation of an investment project by its average book value during its life.
An arbitrary ARR target is usually set which compared with the calculated ARR.
The decision rule under ARR is that an investment should be accepted if its AAR exceeds the target AAR.
Therefore, The average accounting return (AAR) rule can be best stated as ann investment is acceptable if its AAR exceeds a target AAR.
Answer:
$32,264.07
Explanation:
The computation of the Break-even EBIT is shown below:
(EBIT ÷ Number of shares) = (EBIT - Interest) ÷ Number of shares
(EBIT ÷ 10,900) = (EBIT - $66,000 × 0.08) ÷ (10,900 - (66,000 ÷ $37))
(EBIT ÷ 10,900) = (EBIT - $5,280) ÷ (10,900 - 1,783.78)
(EBIT ÷ 10,900) = (EBIT - $5,280) ÷ (9116.22)
After solving this, the value of break-even EBIT is $32,264.07
Answer:
Cleaning service is something I would like to create
Explanation:
Seeing how cleaning is and should be apart of our everyday life system it is important and necessary that we have more products and services that are created. This is one of the most essential things that we need right now.
