Pay back the initial project investment

Assignment Help Financial Accounting
Reference no: EM131259500

Your company has the opportunity to invest $75,000 in a new project opportunity but due to cash flow concerns, your boss wants to know when you can pay back the original investment. Using the discounted payback method, you determine that the project should generate inflows of $30,000, $30,000, $25,000, $25,000, and $20,000, respectively, for an expected five years after completion of the project. Your firm’s required rate of return is 12.5%. Calculate how long it should take to pay back the initial project investment.

Reference no: EM131259500

Questions Cloud

What are the potential ethical implications of transactions : Bobby’s Bagels, a publicly traded corporation whose common stock is listed on a stock exchange, just landed a contract to open 100 new stores in shopping malls across the country. The new business should triple the company’s profits. What are the pot..
Current years charitable contribution deduction : Jorge contributes $35,000to his church and 100 share of XYZ stock to the American Red Cross. The shares were purchased three years ago for $10,000 but were worth $ 18,000 as of the donation date. Jorge's AGI this year is $100,00. Assuming no election..
Journalize in single entry interest expense : How much was Amazon’s long-term debt at December 31, 2009? Of this amount, how much was due within one year? How much was payable beyond one year in the future? Journalize in a single entry Amazon’s interest expense for 2009. Amazon paid cash of $32 ..
Balance sheet and statement of cash flows : Bower Consulting Company started the period with cash of $25,000, common stock of $13,000, and retained earnings of $12,000. Bower engaged in the following transactions in 2016: An inventory of supplies showed $250 of supplies on hand as of December ..
Pay back the initial project investment : Your company has the opportunity to invest $75,000 in a new project opportunity but due to cash flow concerns, your boss wants to know when you can pay back the original investment. Calculate how long it should take to pay back the initial project in..
What price per unit would have been charged to the customer : Job 412 was one of the many jobs started and completed during the year. The job required $9,000 in direct materials and 40 hours of direct labor time at a total direct labor cost of $9,900. If the job contained four units and the company billed at 60..
Compute garys tax due or refund due : During 2016, Gary earned $57,000 as an executive. Gary, who is single, supported his half sister, who lives in a nursing home. Gary received the following interest: $400 on City of Los Angeles bonds, $200 on a money market account, and $2,100 on a lo..
Suppose team is organized as pass-through firm : Suppose a team is organized as a pass-through firm. Further, suppose that there are not physical depreciation or roster depreciation or long-term obligation. the tax rates on both are team and the owner's personal income are 33 percent. explain why t..

Reviews

Write a Review

 

Financial Accounting Questions & Answers

  Designer fads company a local retail clothing store was

designer fads company a local retail clothing store was established april 1 2014. the company issued 8500 shares of 10

  Make the journal entries necessary to record

Make the journal entries necessary to record the transactions above using appropriate dates

  Write a short memo to audrey offering your opinion

Use textbooks or Internet sources for information on the format and contents of a statement of cash flows. To complete this problem, you may wish to use the Excel template provided in the resources.

  Depreciation on a residential rental building costing

he first year of depreciation on a residential rental building costing $200,000 purchased May 2, 2014. The second year of depreciation on a computer costing $3,000 purchased in May 2013, using half-year convection and accelerated depreciation.The thi..

  Investors portfolio beta and portfolio expected return

An investor currently has all of his wealth in Treasury bills. He is considering investing 80% of his funds in General Electric, whose beta is 4.50, with the remainder left in Treasury bills. GE has an expected return of 25% and Treasury bills have a..

  Contract''s separate performance obligations

1.On what basis is the transaction price of a contract allocated to the contract's separate performance obligations?

  Explain this situation using a basic economic principle

water usage in the apartment complex went way down. Explain this situation using a basic economic principle.

  What would be the cost of the ending inventory

First-out method and the perpetual system, what would be the cost of the ending inventory?

  How does m and s use derivative financial instruments

Where is "deferred income taxes" reported in M&S's statement of cash flows? Why does it appear in that section of the statement of cash flows?

  Create a distortion in the accounting records

In most cases, companies can select whichever depreciation method they deem appropriate for assets. The IRS, however requires companies to use MACRS. Doesn't this create a distortion in the accounting records?

  Liability limits-one event or two

Did the September 11 terrorist attacks on the World Trade Center constitute one loss or two? The resolution to this question is far from simple. Controversy surrounding this issue illustrates the ambiguities inherent in some business insurance con..

  In a statement of cash flows

In a statement of cash flows, a change in prepaid expenses would be classified as a. An operating activity b. A financing activity c. An investing activitiy d. A noncash item that need not appear on the statement of cash flows

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