Answer:
19.91 %
Explanation:
The Internal Rate of Return (IRR) is the Interest rate that will make the present values of cashflows equal to the price of the Initial investment.
<u>Calculation of IRR of Project A using a Financial Calculator :
</u>
($100,000) CFj
$30,000 Cfj
$30,000 Cfj
$30,000 Cfj
$30,000 Cfj
$30,000 Cfj
$30,000 Cfj
Shift IRR/YR 19.9054 or 19.91 %
Answer:
A) They would be indifferent, as Sally's income net of costs equals $25,000.
Explanation:
Sally's economic profit = accounting profit - opportunity costs
- accounting profit = $12,000
- opportunity costs = $25,000 - $15,000 in lost salaries + $2,000 (lost investment revenue) = $12,000
economic profit = $12,000 - $12,000 = $0
Since the economic profit is $0, Sally should be indifferent between running her own business or working for someone else.
Answer: $1000
Explanation:
First, we calculate the amount if bad debt expense which will be:
= 3% × $50000
= $1500
Therefore, the balance of accounts receivable at the end of the first year will be:
= Amount of bad debts expense - Account written off
= $1500 - $500
= $1000