The proper cash flow amount to use as initial investment

Assignment Help Financial Management
Reference no: EM131965743

Kenny, Inc., is looking at setting up a new manufacturing plant in South Park. The company bought some land six years ago for $8.6 million in anticipation of using it as a warehouse and distribution site, but the company has since decided to rent facilities elsewhere.

The land would net $11.4 million if it were sold today. The company now wants to build its new manufacturing plant on this land; the plant will cost $22.6 million to build, and the site requires $1,010,000 worth of grading before it is suitable for construction.

What is the proper cash flow amount to use as the initial investment in fixed assets when evaluating this project?

(Enter your answer in dollars, not millions of dollars, e.g., 1,234,567. Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.)

Reference no: EM131965743

Questions Cloud

What and how much are the fixed costs : What and how much are the variable costs? Present each item in cost per cupcake basis. What and how much are the fixed costs?
What is the companys current stock price : The company's beta is 1.70, the required return on the market is 10.50%, and the risk-free rate is 4.50%. What is the company's current stock price?
Narrative of the life of frederick douglas : Analyse the similarities and difference in the autobiography of Benjamin Franklin and narrative of the life of frederick douglas
What were the international implications : What were the international implications for the fall of the Berlin Wall?
The proper cash flow amount to use as initial investment : What is the proper cash flow amount to use as the initial investment in fixed assets when evaluating this project?
What are the strategies of the presidents : What are the strategies of the Presidents, Woodrow Wilson and Reagan? The information have to be credible and please provide URL.
Prepare purchases budget in units and dollars for each month : Budgeted sales of The Music Shop for the first six months of 2010. Prepare a purchases budget in units and dollars for each month, January through May.
What is the present value of these expected cash flow : If Kelly uses 5% as her discount rate, value these cash flows (what is the present value of these expected cash flows)
Which one do you think was the least successful : Of all of the presidents from 1970-2000 - Nixon, Ford, Carter, Reagan, Bush Sr., and Clinton - which one do you think was the most successful?

Reviews

Write a Review

Financial Management Questions & Answers

  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?

  Business finance task - capital budgeting

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.

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