Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Accounting Basics Expert

Consider a project to supply 608,000 postage stamps to the U.S. Postal Service for the next 5 years. You have an idle parcel of land available that cost $760,000 five years ago; if the land were sold today, it would net you $912,000, aftertax. The land can be sold for $1,500,000 after taxes in 5 years. You will need to install $2,356,000 in new manufacturing plant and equipment to actually produce the stamps; this plant and equipment will be depreciated straight-line to zero over the project's 5-year life. The equipment can be sold for $456,000 at the end of the project. You will also need $469,000 in initial net working capital for the project. All net working capital will be recovered when the project ends. The price of the stamp is $0.42 and the production costs are $0.38 per stamp, and you have fixed costs of $608,000 per year. Your tax rate is 30 percent and your required return on this project is 11 percent.

a) What is the gross profit of this project for the next 5 years? (years 1-5).

Accounting Basics, Accounting

  • Category:- Accounting Basics
  • Reference No.:- M939323

Have any Question? 


Related Questions in Accounting Basics

Discussionpart 1 please respond the following question no

Discussion Part 1 please respond the following question no less then 350 words (original work, no plagiarism, 1 reference) "earnings-based valuation" please respond to the following: • Create an argument supporting that ...

Accounting assignmentcolorado springs company csc is a

Accounting Assignment Colorado Springs Company (CSC) is a wholesaler with fiscal year ended December 31 of previous year. Since it is publicly-traded, it undergoes external audit. The most recent audit was completed in F ...

Niagular corp just reported a net income of 8500000 amp its

Niagular Corp. just reported a net income of $8,500,000 & its current stock price is $25.75 per share. Niagular Corp. is forecasting an increase of 25% for its net income next year, but it also expects it will have to is ...

Case study requirementsbullselect an accounting topic of

Case Study Requirements • Select an accounting topic of your choice - this could be revenue recognition, inventory valuation, fair value, stock options, derivatives, investments, segment reporting, leases, just to name a ...

The sanford company had the following balance sheet as of

The Sanford Company had the following balance sheet as of December 31, 20x2. The transactions for the first three months of 20x3 are also presented along with other information about specific accounts. Sanford Company Ba ...

A tractor acquired on january 4 of the current year at a

A tractor acquired on January 4 of the current year at a cost of $100,000 has an estimated life of 10 years. Assuming that it has a residual value of $10,000, determine the depreciation expense in the current year using ...

Problem 1abc stock has a share price of 150 today all

Problem 1 ABC stock has a share price of $150 today. All rates of interest are 3% per annum on a continuously compounded basis. A one-year European call option on one share of stock struck at $147 is worth $15. Finally, ...

Discussionpart 1 please respond the following question no

Discussion PART 1 PLEASE RESPOND THE FOLLOWING QUESTION NO LESS THEN 350 WORDS (ORIGINAL WORK, NO PLAGIARISM, 1 Reference "Negative Cash Flow" Please respond to the following: • Assess how the free cash-flow method can b ...

Accounting and societyrequirementsbackgroundin their annual

Accounting and Society Requirements: Background: In their annual report, companies are required to include a remuneration report that documents the remuneration packages of the chief executive officer, other key executiv ...

1 the accounting equation is assets liabilities owners

1. The accounting equation is assets = liabilities + owner's equity. Please explain the relationship between economic resources and claims to economic resources. Why must this equation always balance? What transactions i ...

  • 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

WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

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