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rjkz [21]
3 years ago
5

Conundrum Mining is expected to generate the above free cash flows over the next four years,after which they are expected to gro

w at a rate of 6% per year. If the weighted average cost ofcapital is 12% and Conundrum has cash of $80 million, debt of $60 million, and 30 millionshares outstanding, what is Conundrumʹs expected terminal enterprise value?A) $413.4 millionB) $459.3 millionC) $505.3 millionD) $528.2 million
Business
1 answer:
frutty [35]3 years ago
4 0

Answer:

B. 459.3 million

Explanation:

FCF5 = $26 million * (1 + 0.06) = 27.6 million

and to continue

V4 = $27.6 million / (0.12 - 0.06) = 459.3 million

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Bradley Snapp has deposited $5,291 in a guaranteed investment account with a promised rate of 4% compounded annually. He plans t
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Answer:

i dont realky understand the question

7 0
3 years ago
It will cost $2,500 to acquire an ice cream cart. Cart sales are expected to be $1,500 a year for three years. After the three y
Dvinal [7]

Answer: 1 year and 6 months

Explanation:

The cash flows are as follows,

Year 0 = ($2,500)

Year 1 = $1,500

Year 2 = $1,500

Year 3 = $1,500

Payback period is the time it will take to break even the intial investment (In this question the initial investment is $2,500)

The sum of the cashflows of year1 and year2 is equal to $3,000

which means that the payback period is somewhere bbetween year 1 and year2

1500/3000 = 0.5 year or 6 months

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3 0
3 years ago
Nirav just opened a savings account paying 2 percent interest, compounded annually. After four years, the savings account will b
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Nirav recently opened a savings account offering 2% annual compound interest, this means that Nirav will earn the same amount of interest each year for four years.

<h3>What is a saving account?</h3>

An account at a retail bank is formally called as a savings account. This is a type of account that person granted a person that his money is safe in a particular bank. Refer to the image below for the complete question.

The given case tells about that <u>what would be the impact</u> of savings account offering 2% annual compound interest on Nirav, then he will earn the same amount of interest compounded each year for four years.

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3 0
1 year ago
Which of the following statements is false concerning the use of ABC in service industries?
ELEN [110]

Answer:

b. When using ABC for service industries, special methods must be used to identify cost pools and cost drivers due to the unique nature of the services offered.

Explanation:

The cost pool method are the same we should look for activities which add value to the product to provide a more accurate product costing.

In cases of services the company will also determinate activities considering this premise therefore, there is no especial nature to offer to the client.

6 0
3 years ago
Tentacle Television Antenna Company provided the following manufacturing costs for the month of June.
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Answer: Tentacle's total fixed costs are: $65400.

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-Janitor's salary $4000

-Property taxes $15000

-Equipment depreciation (straight-line) $22000

-Factory insurance $14000

-Factory manager's salary $10400

So: 4000 + 15000+ 22000 + 14000 + 10400 = <u>$65400.</u>

8 0
3 years ago
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