Answer:
NPV = $10.708 million
Explanation:
<em>The base case NPV is that calculated by discounting the after-tax cash flow by the cost of equity based on asset beta. The base-case NPV does not consider the financing effect of the any particular finance source used to fund the project.</em>
NPV = PV of cash inflow - Initial outlay
After-tax cash flow = 300,000×15= 4.5 million
PV of cash inflow = cash inflow × A × (1- (1+r)^(-n)/r
4.5 ×( 1- (1.16^-5)/0.16= 25.508 million
NPV = PV of cash inflow - Initial outlay
NPV = 25.508 million - 14.8 million
NPV = $10.708 million
Answer:
Explanation:
Total cost per unit <u><em>(Which is calculated by adding up the fixed costs and variable costs and dividing by the overall quantity of units produced.)</em></u> is calculated below:
(20 + 30 + 8 + 13 + 12 + 7)
90
Desired return
20% on 1440000
288000
Per unit 288000/10000.
28.8
Markup on cost
Desired return per unit
28.8
Cost 90
28.8 /90 = 32% on cost
Target sale price
90+28.8
= 118.8
Answer: Bad Debt expense= $34,500
Explanation:
Bad debt expense is the account receivables that a business records amount that would not be received due to lack of payment by its customers.
Using the percentage of receivables method,
Estimated uncollectibles = $14,900
unAdjusted balance in Allowance account = $ 19,600 debit
Bad Debt expense = Estimated uncollectibles +Unadjusted balance of a debit = $14,900 + $19,600= $34,500
This amount of $34,500 will now be recorded through an adjusting entry, The Bad Debt expense will be debited.
Answer:
c. $4,000
Explanation:
Depreciation expense is the appropriate portion of a company's fixed asset's cost that is being used up during accounting period. Under straight-line method, depreciation expense is calculated by formula:
Straight-Line Depreciation Expense = (Cost − Residual Value)
/Useful Life of the Asset
For year 2, depreciation expense = ($25,000-$5,000)/5 = $4,000
Noted:
Depreciation Expense is different from Accumulated depreciation. Accumulated depreciation is the total amount of depreciation expense for an fixed asset that is recorded on the balance sheet. In this situation, the Accumulated depreciation after 2 years is:
Depreciation expense in year 1 + Depreciation expense in year 2 = $8,000
Answer:
$0.68
Explanation:
Multiply each possible prize by its likelihood and add the results in order to obtain the expected value (Note that there is a 100% of losing 0.57 cents since that is the cost of entry):
The expected value of the amount won for one entry if the cost of entering is 57 cents is $0.68