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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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Don executes a will leaving half of his farm to his spouse Elsie and the rest to his sons, Frank and Greg, in equal shares. The
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Answer:

Don executes a will leaving half of his farm to his spouse Elsie and the rest to his sons, Frank and Greg, in equal shares. The will disinherits a third son, Hal. Don and Elsie divorce, but Don dies before changing his will. Under the Uniform Probate Code:

c. Frank and Greg receive the entire estate in equal shares.

Explanation:

  • Uniform Probate Code is applicable in almost 18 states of the United States that was developed to standardize the laws of wills, trusts, and intestacy.
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3 years ago
On January 1, 2021, Jeans-R-Us Company awarded 15 million of its $1 par common shares to key executives, subject to forfeiture i
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Answer and Explanation:

The computation and journal entries are shown below:

1.. The total compensation cost is

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(Being expense is recorded)

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6 0
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Thompson company is offering $3.63 per $1,000 of value;

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Learn more about premium calculation here:

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If the acceptance strategy is used to handle every vulnerability in the organization, its managers may be unable to conduct proa
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Answer:

True

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