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FinnZ [79.3K]
2 years ago
15

Marko, Inc., is considering the purchase of ABC Co. Marko believes that ABC Co. can generate cash flows of $5,700, $10,700, and

$16,900 over the next three years, respectively. After that time, they feel the business will be worthless. Marko has determined that a rate of return of 11 percent is applicable to this potential purchase. What is Marko willing to pay today to buy ABC Co.?
a. $35,797.50
b. $33,300.00
c. $24,457.63
d. $26,176.63
e. $27,560.91
Business
1 answer:
vovikov84 [41]2 years ago
7 0

Answer:

Total PV= $26,176.63

Explanation:

Giving the following information:

Cash flow:

Cf1= $5,700

Cf2= $10,700

Cf3= $16,900

<u>To calculate the price of the investment now, we need to use the following formula on each cash flow:</u>

PV= Cf / (1+i)^n

PV1= 5,700/1.11= 5,135.14

PV2= 10,700/1.11^2= 8,684.36

PV3= 16,900/1.11^3= 12,357.13

Total PV= $26,176.63

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Sale price $60 $100 Variable costs $35 $60 Machine hours required for 1 vase 1 2 Total fixed costs are $600,000, and Rose Incorp
MrRissso [65]

Answer:

a) CM1 = 25

CM2 = 40

b) CMmh1 = 25

CMmh2 = 20

c) 25,000 units of Vase 1 and 12,500 units of Vase 2

d) OI = $ 525,000

Explanation:

a. Determine the contribution margin per unit for each type of vase.

The contribution margin per unit is equal to the difference between the sale price and the variable cost per unit:

CM_1=P_1-VC_1=60-35=25\\\\\\CM_2=P_2-VC_2=100-60=40

b. Determine the contribution margin per machine hour for each type of vase.

For the Vase 1, the number of machine hours per unit is 1. So the contribution margin per machine hour for Vase 1 is equal to CM1=$25.

For the Vase 2, the number of machine hours per unit is 2. Then, the contribution margin per machine hour for Vase 2 is equal to CM2=$40/2=$20.

c. Determine the number of units of each style of vase that Rose Incorporated should produce to maximize operating income.

There are 3 restrictions:

- Max 25,000 units of Vase 1

- Max 25,000 units of Vase 2

- 50,000 hours of machine hour

As the contribution margin per machine hour is higher for the Vase 1, so we start producing the more we can of Vase 1. The limit is 25,000 units.

Then, we are left with 25,000 machine hours available for Vase 2. We can produce 25,000/2=12,500 units, which is under the market constraint.

d. What is the dollar amount of the maximum operating income as calculated in C above

The operating income for the mix proposed in C is:

OI=CM_1*q_1+CM_2*q_2-FC\\\\OI=25*25,000+40*12,500-600,000\\\\OI=625,000+500,000-600,000\\\\OI=525,000

4 0
3 years ago
Janice Coleman is a team leader at Jackson Equipment. She has been promoted several times over the past five years and her perfo
maks197457 [2]

Answer:

B

Explanation:

Janice Coleman is a team leader at Jackson Equipment. She has been promoted several times over the past five years and her performance evaluations are outstanding. One of the vice presidents at Jackson has been very friendly to Janice and has served as her mentor. He has also been asking her to go out with him for the past 2 years. She has declined and the vice president has recently suggested that she could be an area supervisor if he became her advocate with the management team. He has indicated he would be willing to do so if they began a personal relationship. Janice does not agree to the relationship and is promoted to area supervisor. Janice has filed a complaint of sexual harassment with the EEOC. Janice has a case for atmosphere of harassment.

Even though Janice got the promotion the vice president created an atmosphere of harrasment by trying to give her a promotion with a condition. His intentiins is what matters here as well as giving her a condition for a promotion even though she eventually got the position. He stirred up the atmosphere for harrasment.

3 0
3 years ago
Suppose you want to establish a business .describe how you would use any five entrepreneur qualities to make sure that your busi
masha68 [24]
First, is that I will never forget about my passion for the line of work that I am in. Passion means pursuing your dream despite setbacks. 

Second, is that I will make sure that I will be open to new ideas and perspectives. I have to keep my mind open, especially to change. There are many things that I do not know, and if I want to be successful, I will not pretend that I know everything. Being open-minded will help my business thrive. 

Third, I will always strive to learn about my line of work. This coincides with my second quality. 

Fourth, I will make sure that I am always two steps ahead of my game. While having direction is great, it is best to keep my feet up and know what to expect. This will ensure that I will encounter as little problem as possible. 

Lastly, I will never stop innovating. Innovating does not just mean that I should have great ideas; innovating means making my great ideas even greater! By learning how to do so, it will make sure that my business will not get left behind. 
3 0
3 years ago
Wanna be friends lolll
Ann [662]

Answer:

nope but thanks for asking

Explanation:

6 0
3 years ago
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16p²-4pq+25q² please I need help ​
UNO [17]

Answer:

GCF: 1

(4-5)^2 thats the (a-b)^2=a^2-2ab+b^2

Explanation:

6 0
2 years ago
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