Cost of providing this coverage to the security firm

Assignment Help Financial Management
Reference no: EM13870820

A security firm is offered $80,000 in one year for providing CCTV coverage of a property. The cost of providing this coverage to the security firm is $74,000, payable now, and the interest rate is 8.5%. Should the firm take the contract? 

Reference no: EM13870820

Questions Cloud

What was the purpose of introducing pdis : How should a cultural shift from complacency to an explicit focus on individual accountability and performance be managed? What was the purpose of introducing PDIs?
Use rounded numbers in intermediate calculations : You expect to receive $28,000 at graduation in two years. You plan on investing it at 9.75 percent until you have $163,000. Required: How long will you wait from now?   explain if there are any cash flow advantages of detaining
Considered in financial planning and forecasting process : You are the CEO of a company of your choosing and your firm has begun its 2016 financial planning and forecasting. What are the key financial statements that you want to include in this process and why? What key questions need to be answered in this ..
How did the shift affect the employees : How did the shift affect the employees? How did he try to get all the employees to buy into the reshaping of the company?
Cost of providing this coverage to the security firm : A security firm is offered $80,000 in one year for providing CCTV coverage of a property. The cost of providing this coverage to the security firm is $74,000, payable now, and the interest rate is 8.5%. Should the firm take the contract?
Dividends are expected to grow-what is the price of stock : A7X Corp. just paid a dividend of $1.20 per share. The dividends are expected to grow at 15 percent for the next eight years and then level off to a growth rate of 5 percent indefinitely. If the required return is 10 percent, what is the price of the..
What is likely to happen after pais eventual exit : What is likely to happen after PAI's eventual exit? How would momentum be maintained for the employees? Would it be a good idea for Chr. Hansen to be listed again?
What is current share price-earnings to fuel growth : Metallica Bearings, Inc., is a young start-up company. No dividends will be paid on the stock over the next nine years because the firm needs to plow back its earnings to fuel growth. The company will pay a $12 per share dividend in 10 years and will..
What are the core competences of ic companys : What are the core competences of IC Companys? De?ne and evaluate its core competences after the merger. In what position is the company's competitive situation after the merger?

Reviews

Write a Review

Financial Management Questions & Answers

  Corporate bond with twelve years remaining till maturity

A thirty year corporate bond with twelve years remaining till maturity is currently selling for $ 1,088. The market rate of interest for a similar bond is 5.75%. What is the coupon (stated or contract) rate of interest?

  What is the yield on treasury securities

The real risk-free rate of interest is 4%. Inflation is expected to be 2% this year and 4% during the next 2 years. Assume that the maturity risk premium is zero. What is the yield on 2-year Treasury securities? What is the yield on 3-year Treasury s..

  Assuming all payments are in the form of dividends

The Wei Corporation expects next year's net income to be $20 million. The firm's debt ratio is currently 45%. Wei has $10 million of profitable investment opportunities, and it wishes to maintain its existing debt ratio. According to the residual dis..

  Calculate the elasticity coefficient

The Super Global International Food Market is filled with nuts, books, vegetables, fruits, rice, foreign DVDs, international magazines and more. Find foods from Armania, Turkey, Russia, India and beyond. The owner takes pride in offering fruits and v..

  Interest income is distributed

Arnold Ziffle established a trust fund that provides $75,000 in scholarships each year for worthy students. The trust fund earns a 5 percent rate of return. How much money did Ziffle contribute to the fund assuming that only the interest income is di..

  What will be the value of the investment in two years

Your brother has asked you to help him with choosing an investment. He has $6,000 to invest today for a period of two years. You identify a bank CD that pays an interest rate of 0.0300 annually with the interest being paid quarterly. What will be the..

  What monthly car mortgage payments

What monthly car mortgage payments for the next 36 months are required to amortize a present loan of $3000 if interest is 12% compounded monthly?

  Executive roles of management-planning-organizing-leading

How does the concept of the time value of money affect decisions made across the four executive roles of management -- planning, organizing, leading, and controlling? Why is this concept important for the contemporary executive to understand?

  Calculate eco s current cost of preferred stock

Calculate Eco s current after-tax cost of long-term debt, calculate Eco s current cost of preferred stock

  Analyzing purchase of a machine costing

Your Company is analyzing purchase of a machine costing $5,900 today. The investment promises to add $18,500 to sales one year from today, $14,500 two years from today and $18,000 three years from today. Incremental cash costs should consume 75% of t..

  Taxable project with an expected before-tax return

A corporation has an average tax rate of 25% and a marginal tax rate of 39%. The corporation can invest in a tax-free project with an expected before-tax return of 6.8% or in a taxable project with an expected before-tax return of 10%.

  Calculating annuity cash flows

If you put up $42,000 today in exchange for a 6.50 percent, 16-year annuity, what will the annual cash flow is? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd