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
Sever21 [200]
3 years ago
7

DYI Construction Co. is considering a new inventory system that will cost $750,000. The system is expected to generate positive

cash flows over the next four years in the amounts of $350,000 in year one, $325,000 in year two, $250,000 in year three, and $180,000 in year four. DYI's required rate of return is 8%. What is the net present value of this project?
$87,417

$96,320

$104,089

$183,472
Business
1 answer:
Oksanka [162]3 years ago
6 0

Answer:

Year Cashflow        [email protected]% PV

$                      $

0 (750,000)             1          (750,000)

1        350,000               0.9259    324,065

2       325,000               0.8573     278,623

3        250,000              0.7938      198.450

4        180,000               0.7350      132,300

                                        NPV         184,438

The correct answer is D. The difference in answers is due to rounding error.

Explanation:

Net present value is the diffrence between initial outlay and present value of inflow. We need to discount the cash inflows for year 1 to year 4 at 8% and then calculate the present value of cash inflows by multiplying the cash inflows by the discount factors. Finally, we will calculate NPV by deducting the initial outlay from the present value of cash inflows.

You might be interested in
Astoria Co. had the following transactions during the month of August 2014: * Cash received from bank loans was $20,000. * Divid
Fynjy0 [20]

Answer: $158,000

Explanation:

Equity = Opening equity + Net Income - Dividends

Net Income = Revenue - expenses

= 33,500 - 26,000

= $7,500

Equity = 160,000 + 7,500 - 9,500

= $158,000

6 0
3 years ago
Looking forward to next year, if Baldwin's current cash balance is $25,719,453 and Cash Flows From Operations next period are un
jarptica [38.1K]

Answer:

Purchases assets at a cost of $25,000,000

Explanation:

The first three options are related to an increase in the cash available:

(A) takes a loan so cash increase

(B) sells assets so cash also increase

(C) issued shares, which also increase the cash available

while the purchase of assets will decrease cash. Exposing the company to a certain risk of needing a loan

5 0
3 years ago
MySchool Notebook Company uses 100,000 pounds of plastic pellets per year in the production of their custom 3-ring school binder
Anton [14]

Answer:

11547 lb

Explanation:

Economic Order Quantity is the ordering quantity where the cost of ordering and holding inventory is the minimum. It is the point where the cost of ordering and holding inventory intersects.

To calculate the Economic Order Quantity we use the following formula,

  • EOQ =√(2 × Annual Demand × Ordering Cost/Order) / Holding Cost per unit per annum

Plugging in the values in the formula,

  • EOQ = √(2 × 100000 × 100) / 0.15  ⇒ 11547.00538 rounded off to 11547 lbs
3 0
3 years ago
Is Universal Social Charge, Income tax or Consumer tax? ​
skelet666 [1.2K]

Answer:

income tax

Explanation:

5 0
3 years ago
Read 2 more answers
How do property right benefit entrepeneurs?
Vikki [24]

Answer:

Through allowing themselves to buy resources and spend them accordingly.

Explanation:

  • Properties law provides full authority for merchants or developers with possession of such resources or properties.
  • However, once the property has been enforced upon that estate, all persons besides just their owners haven't even the ability to access the property without any of the consent of their heirs.

Thus the above is the correct approach.

6 0
2 years ago
Other questions:
  • Sales for the year for Victor Company were $1,000,000, 70 percent of which were on credit. The average gross profit on sales was
    13·1 answer
  • Edith Engineer travels from city to city to conduct her business. Every other year she buys a used car for about $12,000. The de
    11·2 answers
  • irect materials purchased (on account) $9,200 Conversion costs incurred 14,600 Number of guitars produced 400 guitars Number of
    13·1 answer
  • The domestic opportunity cost of producing a television in the United States is 20 bushels of wheat. In Korea, the domestic oppo
    11·1 answer
  • The three modern types of entrepreneur that have emerged after the description of different entrepreneurial types by Arthur Cole
    5·2 answers
  • On January 1, Avers Co. borrowed $10,000 cash from Main St. Bank by signing a 60-day, 8% interest-bearing note. On March 1, Aver
    5·1 answer
  • Suppose the real GDP of this economy grows at an annual rate of 5%. Assume that the central bank would like to keep the inflatio
    12·1 answer
  • First Class, Inc., expects to sell 28,000 pool cues for $14 each. Direct materials costs are $3, direct manufacturing labor is $
    7·1 answer
  • The country of Lydania has a complex network of pipelines that transports natural gas for millions of people. These pipelines ar
    6·1 answer
  • 4. Profit maximization and loss minimization
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!