### Net present value and payback

Assignment Help Financial Management
##### Reference no: EM13923744

You are contemplating the purchase of a new \$1,840,000 computer-based dairy cow feeding system. The system will be depreciated straight line over its ten year life and have no value at the end of its life. You will earn \$530,000 per year from additional milk production. IF the tax rate is 25% and the required return to capital is 1%, compute the following--on an after-tax basis--for this project:

a} Payback

b} Net Present Value.

Please show all work and relevant formulas used in calculations.

#### Questions Cloud

 Broze company makes four products in a single facility : Broze Company makes four products in a single facility. Create portfolio with an expected return : You have \$21,000 to invest in a stock portfolio. Your choices are Stock X with an expected return of 10 percent and Stock Y with an expected return of 12.5 percent. If your goal is to create a portfolio with an expected return of 10.95 percent, how m.. It systems that have affected business : Identify five different IT systems that have affected business in the past few years. For each system, briefly note the following: A name for the system When discounting cash flows : When discounting cash flows: Net present value and payback : You are contemplating the purchase of a new \$1,840,000 computer-based dairy cow feeding system. The system will be depreciated straight line over its ten year life and have no value at the end of its life. You will earn \$530,000 per year from additio.. Apply standard deviation on sampling : A sample of 40 children with chronic bronchitis is studied and their mean PEF is 279 with a standard deviation of 71. Discuss the limitations of ratio analysis : Discuss the limitations of ratio analysis. In a summary explain the limitations of ratio analysis to help me with a project. I need good details, with well explained limitations please. Calculate the required ending-wealth value for the portfolio : Calculate the required ending-wealth value for this portfolio. Calculate the value of the required floor portfolios at the end of Years 1, 2, and 3. Farm will require an initial investment : Archer Daniels Midland Company is considering buying a new farm that it plans to operate for 10 years. The farm will require an initial investment of \$11.80 million. This investment will consist of \$2.70 million for land and \$9.10 million for trucks ..

### Write a Review

#### Foreign company acquisition

Acquisition by a foreign company and the effects of that decision and the results of foreign exchange in Euro and the exchange rate differences.

#### Financial management for profit and non profit organizations

In this essay, we are going to discuss the issues of financial management in a non-profit organisation.

#### Method for estimating a venture''s value

Evaluate venture's present value, cash and surplus cash and basic venture capital.

#### Replacement analysis

This document show the Replacement Analysis of modling machine. Is replacement give profit to company or not?

Your company is considering using the payback period for capital-budgeting. Discuss the advantages and disadvantages of this technique.

#### Analysis of the investment

In this project, you will focus on one of these: the additional cost resulting from the purchase of an apple press (a piece of equipment required to manufacture apple juice).

#### Conduct a what-if analysis

Review the readings and media for this unit, including the Anthony's Orchard case study media. Familiarise yourself with the Anthony's Orchard company and its current situation.

#### Determine operational expenditures

Organisations' behaviour is guided by financial data. In the short term, such data will help determine operational expenditures; in the long term, historical data may help generate forecasts aimed at determining strategic plans. In both instances.

#### Personal financial management

How much will you have left over each half year if you adopt the latter course of action?

#### Sources of finance for expansion into new foreign markets

A quoted company is considering several long-term sources of finance for expansion into new foreign markets.

#### Long term financial planning

This assignment is designed for analyze Long term financial planning begins with the sales forecast and the key input in the long term fincial planning.

#### Explain the role of fincial manager

This assignment explain the role of fincial manager, function of manger. And what are the motives of financial manager.