Finance Help

Axis Corp. is studying two mutually exclusive projects. Project Kelvin involves an overhaul of the existing​ system; it will cost ​$50 comma 000 and generate cash inflows of ​$25 comma 000 per year for the next 3 years. Project Thompson replaces the existing​ system; it will cost ​$265 comma 000 and generate cash inflows of ​$70 comma 000 per year for 6 years. Using​ a(n) 10.16​% cost of​ capital, calculate each​ project's NPV, and make a recommendation based on your findings. #NetPresentValue #FinanceHelp #Finance #Techniques

Billabong Tech uses the internal rate of return​ (IRR) to select projects. Calculate the IRR for each of the following projects and recommend the best project based on this measure. Project​ T-Shirt requires an initial investment of ​$24 comma 000 and generates cash inflows of ​$9 comma 000 per year for 6 years. Project Board Shorts requires an initial investment of ​$27 comma 333 and produces cash inflows of ​$10 comma 000 per year for 7 years. #Techniques #FinanceHelp #InternalRateOfReturn #Finance

Herky Foods is evaluating a new wrapping machine. With the​ machine, Herky will save money on packaging in each of the next 5​ years, producing the series of cash inflows shown in the following​ table: LOADING....   The initial investment is ​$1.59 million. Using a 9​% discount​ rate, determine the net present value​ (NPV) of the machine given its expected cash inflows. Based on the ​project's NPV​, should Herky make this​ investment? #NetPresentValue #Excel #MicrosoftExcel #Technqiues

Figurate Industries has 780,000 shares of cumulative preferred stock outstanding. It has passed the last three quarterly dividends of ​$1.60 per share and now​ (at the end of the current​ quarter) wishes to distribute a total of ​$12 million to its shareholders. If Figurate has 2.6 million shares of common stock​ outstanding, how large a​ per-share common stock dividend will it be able to​ pay? #AccountingHelp #Commonstock #PreferredStock #FinanceHelp

Monthly loan payments  Personal Finance Problem   Tim Smith is shopping for a used luxury car. He has found one priced at $ 36,000. The dealer has told Tim that if he can come up with a down payment of ​$6,600​, the dealer will finance the balance of the price at a 6​% annual rate over 4 years ​(48 ​months). a.  Assuming that Tim accepts the​ dealer's offer, what will his monthly​ (end-of-month) payment amount​ be? b.  Use a financial calculator or spreadsheet to help you figure out what​ Tim's monthly payment would be if the dealer were willing to finance the balance of the car price at an annual rate of 3.4​%? #FinanceHelp #AccountingHelp #PresentValue

Present​ value: Mixed streams   Consider the mixed streams of cash flows shown in the following​ table a.  Find the present value of each stream using a 6​% discount rate. b.  Compare the calculated present values and discuss them in light of the undiscounted cash flows totaling ​$70 comma 000 in each case. Is there some discount rate at which the present values of the two streams would be​ equal? #FInanceHelp #AccountingHelp #Excel #FutureValue #Investments

Time to accumulate a given sum Personal Finance Problem   Manuel Rios wishes to determine how long it will take an initial deposit of ​$9000 to double. a.  If Manuel earns 9​% annual interest on the​ deposit, how long will it take for him to double his​ money? b.  How long will it take if he earns only 6​% annual​ interest?   c.  How long will it take if he can earn 11​% annual​ interest? d. Reviewing your findings in parts a​, b​, and c​, indicate what relationship exists between the interest rate and the amount of time it will take Manuel to double his money. #FinanceHelp #Accounting #Excel #MicrosoftExcel

Value of a mixed stream   Harte​ Systems, Inc., a maker of electronic survillance​ equipment, is considering selling the rights to market its home security system to a​ well-known hardware chain. The proposed deal calls for the hardware chain to pay Harte ​$32000 and ​$25 000 at the end of years 1 and 2 and to make annual​ year-end payments of ​$12 000 in years 3 through 9. A final payment to Harte of ​$20 000 would be due at the end of year 10. a.  Select the time line that represents the cash flows involved in the offer. b.  If Harte applies a required rate of return of 9​% to​ them, what is the present value of this series of​ payments? c.  A second company has offered Harte an immediate​ one-time payment of ​$110 000 for the rights to market the home security system. Which offer should Harte​ accept? #FinanceHelp #Excel #AccountingHelp

Single-payment loan repayment  Personal Finance Problem   A person borrows ​$360 that he must repay in a lump sum no more than 10 years from now. The interest rate is 7.3​% annually compounded. The borrower can repay the loan at the end of any earlier year with no prepayment penalty. a.  What amount will be due if the borrower repays the loan after 2 ​year? b.  How much would the borrower have to repay after 4 years​? c.  What amount is due at the end of the tenth ​year? #FinanceHelp #FutureValue #PresentValue