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vesna_86 [32]
3 years ago
5

Jarvey Corporation is studying a project that would have a ten-year life and would require a $450,000 investment in equipment wh

ich has no salvage value. The project would provide net operating income each year as follows for the life of the project (Ignore income taxes.): Sales $ 500,000 Less cash variable expenses 200,000 Contribution margin 300,000 Less fixed expenses: Fixed cash expenses $ 150,000 Depreciation expenses 45,000 195,000 Net operating income $ 105,000 The company's required rate of return is 12%. What is the payback period for this project?
Business
1 answer:
Nastasia [14]3 years ago
6 0

Answer:

3 years

Explanation:

Since the income tax is ignored, so the operating cash flows would be

= EBIT + Depreciation - Income tax expense

= $105,000 + $45,000 - $0

= $150,000

The operating cash flows are same for ten years

And, the initial investment is $450,000

So, the payback period would be

= Initial investment ÷ Net cash flows

= $450,000 ÷ $150,000

= 3 years

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The Marginal product curve is hump-shaped and the marginal cost curve is U-shaped because these two move in opposite directions to each other.

If the marginal cost is decreasing therefore, the marginal product must be increasing. If the marginal cost is decreasing and the marginal product is increasing, average variable cost will have to fall because every additional unit produced incurs less cost so the average has to fall as well.

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h. After a promising start, Mercosur, the major Latin American trade agreement, has faltered and made little progress since 2000
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Which of the following is true about conflicts of interest?
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3 years ago
Mesa County contracts with New Construct Inc. to build a courthouse. New Construct hires Odell to excavate the site. Odell’s wor
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Answer:

c. liable on the ground that Mesa is an intended third-party beneficiary

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            In the context, Mesa is a third party beneficiary. The Mesa County enters into a contract with New Construct Inc. to construct a court house. Now New Construct Inc. again hires the firm Odell to excavate the land site.

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2 years ago
Adjusting Entries Journalize the adjusting entry needed at December 31 for each situation. Record debits first, then credits. Ch
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Date       Accounts Titles                Debit         Credit

Dec-31    Salaries expense              $2,300  

                     Salaries payable                         $2,300

Dec-31    Depreciation expense     $200

               (Furniture )

                      Accumulated depreciation        $200

                       (Furniture)

Dec-31    Insurance expense          $450

                       Prepaid Insurance                   $450

Dec-31    Supplies expense             $80

                        Supplies                                   $80

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2 years ago
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