Imagine you are a manager prepare a memorandum (memo) to outlining the content in the video

The management of Nebraska Corporation is considering the purchase of a new machine costing $490,000. The company's desired rate

ankoles [38]

Answer:

The payback period is more than 5 years

Explanation:

Net present value is the Net value of all cash inflows and outflows in present value term. All the cash flows are discounted using a required rate of return.

Year Cash flow PV factor Present Value

0 ($490,000) 1 ($490,000)

1 $40,000 0.909 $36,360

2 $10,000 0.826 $8,260

3 $120,000 0.751 $90,120

4 $90,000 0.683 $61,470

5 $180,000 0.621 $111,780

Net Present Value ($182,010)

NPV of this Investment is negative so, it is not acceptable.

Payback period

Total Net cash inflow of the investment is $440,000 and Initial investment is $490,000. This investment will take more than 5 years to payback the initial investment.

6 0

3 years ago

Your company introduced a new product one month ago. Since then, the Website has processed so many orders that the shipping and

blondinia [14]

Answer: The web team can create a FAQ page.

Explanation: FAQ is an abbreviation for Frequently Asked Questions. A FAQ page is a page on an c ecommerce store, where answers to important questions about a company or its products and services have been stored. This is done to clarify the uncertainties of customers and show them how the company or its products and services work.

This will greatly help the company reduce questions directed to sales team, as customers can easily find answer to their questions in the FAQ page

3 0

3 years ago

In december 1994 a man in ohio decided to deposit all of the 8 million pennies he’d been saving for nearly 65 years. (his deposi

Yakvenalex [24]

If in December 1994 a man in Ohio decided to deposit all of the 8 million pennies he’d been saving for nearly 65 years, then his transactions deposits will be $8,000,000, his total reserves will be all in all 8 million pennies.

4 0

3 years ago

Which tools allow economists to determine if the allocation of resources determined by free markets is desirable?.

nirvana33 [79]

Consumer and producer surplus.

6 0

2 years ago

East Publishing Company is doing an analysis of a proposed new finance text. Using the following data, answer Parts a through e.

Alik [6]

Answer:

a. Determine the company’s breakeven volume for this book. •i. In units ii. In dollar sales

total fixed costs = $70,000

variable costs per unit = $16

sales price = $30

contribution margin = $30 - $16 = $14

break even point in units = $70,000 / $14 = 5,000 textbooks

break even point in $ = 5,000 x $30 = $150,000

b. Develop a breakeven chart for the text.

units fixed costs variable costs total costs total sales

0 70000 0 70000 0

1000 70000 16000 86000 30000

2000 70000 32000 102000 60000

3000 70000 48000 118000 90000

4000 70000 64000 134000 120000

5000 70000 80000 150000 150000

6000 70000 96000 166000 180000

I attached the graph that corresponds to this break even chart.

c. Determine the number of copies East must sell in order to earn an (operating) profit of $21,000 on this text.

($70,000 + $21,000) / $14 = 6,500 units

total sales = 6,500 x 30 = $195,000

d. Determine total (operating) profits at the following sales levels: i. 3,000 units •ii. 5,000 units iii. 10,000 units

i. $28,000 loss

ii. no gain/loss, break even point

iii. $70,000 gain

e. Suppose East feels that $30.00 is too high a price to charge for the new finance text. It has examined the competitive market and determined that $24.00 would be a better selling price. What would the break even volume be at this new selling price?

new contribution margin = $24 - $16 = $8

new break even point in units = $70,000 / $8 = 8,750 textbooks

3 0

3 years ago