Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Q. Example on investment appraisal method ?
Contribution per unit = 3·00 - 1·65 = $1·35 per unit
Total annual contribution = 20000 × 1·35 = $27000 per year
Annual cash flow after fixed costs = 27000 - 10000 = $17000 per year
Payback period = 50000/17000 = 2·9 years
(Supposing that cash flows occur evenly throughout the year)
The payback period computed is greater than the maximum payback period used by Umunat plc of two years and on this basis should be rejected. Utilize of payback period as an investment appraisal method cannot be recommended but because payback period doesn't consider all the cash flows arising from an investment project as it ignores cash flows outside of the payback period. In addition payback period ignores the time value of money.
The reality that the payback period is 2·9 years must not therefore be a reason for rejecting the project. The project must be assessed using a discounted cash flow method such as net present value or internal rate of return since the project as a whole may generate an acceptable return on investment.
Baruch Lev, who is a professor of accounting at New York University and a globally known academic for his research on financial reporting for intangibles, is that the economy has c
Morningside nursing Home, a not-for-profit corporation, is estimating its corporate cost of capital. Its tax-exempt debt currently requires an interest rate of 6.2 percent and its
GoFlo is a small growing firm that is considering the purchase of another truck to serve GoFlo's expanding customer base. The new truck will cost $21,000 and should generate annual
Carnival Cruise Lines This question has two parts. Answer both parts. Structure your response using headings and subheadings where appropriate. The use of tables and point fo
Bell Mountain Vineyards is considering updating its current manual accounting system with a high-end electronic system. While the new accounting system would save the company mon
Is goodwill a fictitious asset?
Q. Design a organisational strategy? The objectives to which organisational approach relates depend on the relative power of different stakeholders associated with the company
In June 2004, Feltex Carpets Limited raised NZ $254 million in an initial public offering. Twenty seven months later the company was in receivership, its share price having collaps
Explain:- Q.1 Explain the ways in which the needs of internal and external users of accounting information are the same and different. Q.2 Why is it important for financial sta
In order to enhance sales from their present annual $35 million, ABC Company, a retailer, is considering more liberal credit standards. Presently, the firm has an average collectio
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!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd