Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Accounting Basics Expert

Q1) a. If project is undertaken, at t = 0 company will need to increase its inventories by $50,000, and its accounts payable will increase by $10,000.  This net operating working capital will be recovered at end of project's life (t = 4).

b. If project is undertaken, company will realize extra $600,000 in sales over each of next four years (t = 1, 2, 3, and 4). Company's operating costs (not including depreciation) will equal $400,000 a year.

c. Company's tax rate is 40%.

d. At t = 4, project's economic life is complete, but it will have salvage value (before-tax) of $50,000.

e. Project's WACC is 10%.

f. Company is very profitable, so any accounting losses on this project can be utilize to decrease company's overall tax burden.

i) Compute project's net present value (NPV)? What does it mean?

ii) Determine the IRR of the project? What does it imply?

iii) If sales figure has plus or minus 5% movement and operating cost has about 6% plus or minus changes, what must be investment decision in best case scenario?

iv) If sales figure has plus or minus 5% movement, and operating cost has about 6% plus or minus changes, what must be investment decision in worst case scenario?

v) If alternative of project offers and overseas investment opportunity for four years with 12% return and presently has exchange rate as 1$USD = .95FOREIGN DOLLAR and dollar depreciates at rate of 5% every year, must CARLOS company select alternative investment?

Accounting Basics, Accounting

  • Category:- Accounting Basics
  • Reference No.:- M916932

Have any Question? 


Related Questions in Accounting Basics

Accounting assignmentaccounting is the study of how

Accounting Assignment Accounting is the study of how businesses track their income and assets over time. Accountants engage in a wide variety of activities in addition to preparing financial statements and recording busi ...

Dq1respond to the ethics discussion case at the end of

DQ1 Respond to the Ethics Discussion Case at the end of chapter 5 in the textbook. Dan owns a successful sports bar in downtown Providence. The state is considering legislation that would restrict the sale of alcohol in ...

Questiona not-for-profit organization receives a restricted

Question: A not-for-profit organization receives a restricted gift. When, and in which type of fund, should it recognize the revenue? When, and in which type of fund, should it recognize the related expense? What is the ...

Write a 700- to 1050-word summary of the teams discussion

Write a 700- to 1,050-word summary of the team's discussion about IFRS versus GAAP, based on your team collaborative discussions. The summary should be structured in a subject-by-subject format. An introduction and a con ...

Capital budgeting analyzing project cash flows alexandria

Capital Budgeting: Analyzing Project Cash Flows (Alexandria Chemical Products Company) In early 1980s Alexandria Chemical Products started as a small firm between two friends to produce detergent products. By the end of ...

What is the difference between a significant deficiency and

What is the difference between a significant deficiency and a material weakness as it relates to internal Control? How does the presence of one material deficiency affect the auditor's report on internal controls under t ...

Assignment- fraud in the accounting information systemfor

Assignment- Fraud in the Accounting Information System For this assignment, research the Internet or Strayer databases to locate a firm that was involved in a fraud and / or embezzlement case. Explain how the firm's acco ...

Conduct a cost analysis of gas versus electric vehicle find

Conduct a cost analysis of gas versus electric vehicle. Find the break-even point assuming gasoline is $3.00/gallon with an average of 22 miles per gallon that costs $25,000. Compared to an electric vehicle for $35,000 t ...

Sarbanes oxley requires that per section 404 that internal

Sarbanes Oxley requires that per Section 404 that Internal Controls within a publicly held company are to be reviewed, evaluated and tested at year end to insure that adequate controls are in place. In addition to unders ...

Gasbvisit the website of the governmental accounting

G.A.S.B Visit the website of the Governmental Accounting Standards Board (G.A.S.B.) at http://gasb.org. Review the website to learn about the organization, its act ivies, and its goals. Review one or more of the "Plain-L ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro

Describe what you learned about the impact of economic

Describe what you learned about the impact of economic, social, and demographic trends affecting the US labor environmen