What is net salvage value of new equipment

Assignment Help Financial Management

Reference no: EM131935595

The companys bonds have a par value if 1000 and are currently priced ar 857.22 per 6% of bond, paying interest annually and maturing in 11 years. the companys stock has a beta of 1.20, the return on the market is 15% and the risk free rate is 2%. the company has no preffered stock outstanding, nor any foresseable intention of issuing preffered stock. its long term targeted debt/equity ratio is .60 the company marginal tax rate is 40%

Lani wants you to evaluate the purchase of a new equipment for 333,000 with shipping and installation addingg 15,000 to the capital cost. the new equipment will be depricated over 5 years on a straight line method it is expected that it can be sold for 30,000 at the end of 5 years.

What is the net salvage value of the new equipment?

Net Operating cash flow?

NPV?

Reference no: EM131935595

Questions Cloud

The return on investment and return on exchange rate : Show the investor’s overall return on the LBR investment, and the return separated into the return on investment and return on exchange rate.

Perpetual bonds with annual coupon payments : Bowdeen Manufacturing intends to issue callable, perpetual bonds with annual coupon payments.

Use the cash-back offer as down payment : Assume you use the cash-back offer as a down payment on the car

Each of the first two years by straight-line method : Determine the depreciation for each of the first two years by the straight-line method.

What is net salvage value of new equipment : What is the net salvage value of the new equipment? Net Operating cash flow?

What is the Payback-NPV and IRR of this project : Your firm only accepts projects with a payback period of less than 3.5 years. What is the Payback, NPV and IRR of this project

First month payment is applied to paying off principal : How much of the first month’s payment is applied to paying off the principal?

Planning to make annual deposits : You are planning to make annual deposits of $5,730 into a retirement account that pays 9 percent interest compounded monthly.

What is the profit/loss for long bull spread : Using these options what is the profit/loss for a long bull spread if the price at expiration of the options is quoted as $110 ?

User Account

All Pages