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Crazy boy [7]
3 years ago
9

West Street Automotive is considering adding state safety inspections to its service offerings. The equipment necessary to perfo

rm these inspections will cost $551,000 and will generate cash flows of $193,000 over each of the next five years. If the cost of capital is 17 percent, what is the MIRR on this project
Business
1 answer:
Over [174]3 years ago
6 0

Answer:

19.7%

Explanation:

The modified internal rate of return is a capital budgeting method used to determine the profitability of an investment. The MIRR assumes that cash inflows are reinvested at the firm's cost of capital and outflows are financed at the firm's financing cost.

MIRR = (Future value of a firm's cash inflow / present value of the firm's cash outflow)^ (1/n)  - 1

Future value = payment x[ (1 + interest rate)^n - 1 ] / interest rate

$193,000 x (1.17^5) - 1 / 0.17 = 1353779.24

1353779.24 / $551,000) ^0.2 - 1 = 19.7%

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In July, Lane Co. sells merchandise to Avery Co. on account. In August, Avery pays the balance in full. The entry that Lane will
grandymaker [24]

The entry that Lane will make to record the receipt of cash will include a credit to the: a. Accounts Receivable.

<h3>What is Accounts Receivable?</h3>

Accounts Receivable can be defined as the amount a company is expected to receive from their clients or customers for the goods and service they rendered to their clients.

Based on the information given the appropriate journal entry to record the transactions is:

Debit Cash

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Inconclusion the entry that Lane will make to record the receipt of cash will include a credit to the: a. Accounts Receivable.

Learn more about account receivable here:brainly.com/question/24848903

7 0
2 years ago
Inventory Ratio Calculations
tatuchka [14]

Answer:

Inventory Turnover Ratio for 2008=  3.223 Times

Inventory Turnover Ratio for 2009= 3.91 times

Explanation:

Inventory Turnover Ratio=  Cost of Goods Sold / Average Inventories

Inventory Turnover Ratio for 2008=  $632,000/ $201,000 + 191,100/2

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Inventory Turnover Ratio for 2008=  3.223  times

Inventory Turnover Ratio for 2009=  $ 731,000/191,100 + 182,600/2

Inventory Turnover Ratio for 2009=  $ 731,000/ 186,850

Inventory Turnover Ratio for 2009= 3.91 times

7 0
3 years ago
If a taxpayer does not have enough taxes withdrawn from her paychecks throughout the year to equal the total tax she is required
polet [3.4K]

Answer:

$209

Explanation:

Since Mary's estimated annual income taxes are $5,424, then to determine the amount that should be withheld every two weeks, all we need to do is divide her total estimated taxes by 26 weeks = $5,424 / 26 weeks = $208.62 ≈ $209. generally you do not include cents in tax filings or payments, you need to round up or down. In this case you need to round up, even software rounds the amounts to the nearest dollar.  

6 0
3 years ago
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4 0
3 years ago
Brad's Diner is expanding and expects operating cash flows of $32,000 a year for 4 years as a result. This expansion requires $3
lawyer [7]

Answer: $57,101.73

Explanation:

First find the present value of the cash inflows. The $32,000 is a constant payment so is an annuity. The net working capital will be realized at the end of the project as well.

Present value of cash inflows = (32,000 * Present value interest factor of an annuity, 4 years, 12%) + 3,000/ (1 + 12%)⁴

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= $57,101.73

5 0
3 years ago
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