Answer:
Present Value 5,715,331.32
We are going to accept the project only if the initial investment is at 5,715,331 or below in order to achieve the return to support the cost of capital structure of the company
Accepting a project with a higher cost will not generate enought cashflow to sustain the patyment of debt and the return expected from the stockholders therefore, will generate a economic result and investor will leave the company for other which can sustain their desired return.
Explanation:
We are going to discount the yearly cash-flow at the given rate of 12.50%
then, the terminal value which is the present value of the future period will also be discounted at this rate.
The sum of all this will be the present value of the firm.
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The formula we use the present value of a lump sum:
We are going to accept the project only if the initial investment is at 5,715,331 or below in order to achieve the return to support the cost of capital estructure of the company
Answer:
$2,500,000
Explanation:
Data provided
Ending assets = $1,500,000
Inventory turnover = 6.0 times
Net sales = $8,000,000
The computation of beginning total asset balance is shown below:-
Average total assets = $8,000,000 ÷ 4
= $2,000,000
Total assets = $2,000,000 × 2
= $4,000,000
Beginning assets = Total assets - Ending assets
= $4,000,000 - 1,500,000
= $2,500,000
Therefore we applied the above formula
Answer:
OPtion (C) is correct.
Explanation:
Given that,
Issuance of common stock = $100,000
Dividends paid to the company's stockholders = $2,000
Depreciation expense = $6,000
Repayment of principal on bonds = $40,000
Proceeds from the sale of the company's used equipment = $39,000
Purchase of land = $230,000
Cash flow from financing activities:
= Issuance of common stock - Dividends paid to the common stockholders - Repayment of principal on the company's own bonds
= $100,000 - $2,000 - $40,000
= $58,000
Therefore, the net cash inflow from financing activities is $58,000.
Answer:
carrot cake originated from such carrot puddings eaten by Europeans in the Middle Ages, when sugar and sweeteners were expensive and many people used carrots as a substitute for sugar.
Answer:
The corporation's current income tax expense or benefit would be $86,940.
Note: The Internal Revenue Service (IRS) 2019 tax rate of 21% for corporation is used since the tax rate is not given in the question.
Explanation:
Details Amount ($)
Pretax book income 620,000
Favorable temporary differences (160,000)
Unfavorable temporary differences 106,000
Favorable permanent differences <u> (152,000) </u>
Adjusted income 414,000
Tax expenses (at 21%) <u> (86,940) </u>
Profit after tax <u> 327,060 </u>
Therefore, the corporation's current income tax expense or benefit would be $86,940.
Note: The Internal Revenue Service (IRS) 2019 tax rate of 21% for corporation is used since the tax rate is not given in the question.
