Taking the option to abandon into account, what is the project’s NPV? (d) What is the value of the option to abandon? Solution: (a) Using an initial cash flow of -2.1 million followed by 10 cash flows of 420,000 each and a discount rate of 16%, calculate NPV. You should get NPV = -$70,044.46. (b) Since the opportunity cost of continuing the project is 1.4 million and the project has 9 years left, use your calculator with n=9, R=16%, PV=−1.4 million and FV=0.
Both monies pooled together after taxes add together the sum of £1626.56. With outgoings at £1140 and £1625 pooled together there is a difference of £405 which split between the two girls would be a total of £202.50. Using the online household equivalence calculator this compensates Praveena’s loss of income by 37%. Case study 2 Casper is in the process of paying for his holiday which will cost him £2000, he is considering what to do? If Casper decided to take out a loan that charges 20% APR over one year for the amount of £2000 over 12 months he would expect to pay £183 per month for 12 months with interest of £205.
And the steel deliveries are in a three-day window. Moreover, Kenco implements the cycle counting where 100 items making up 80% of the sales volume are counted every four weeks. What is left in inventory in 12 months is discounted to sell or scrapped. 5) Describe Kenco’s CI system and compare this process change using traditional budgeting Kenco CI system is following four steps: _ Activities for improvement must be selected _ Root causes for the activities performance as it exists must be determined _Modifications must be discovered and implemented _The impact of the change must be assessed. Traditional budgeting always plans and setting a budget for revenues and expenses, and it only focuses on short-term but not planning on long-term vision.
Accounting 381 Winter 2010 Name ________________________________ Quiz 2: 15 points (1 point each) 1. Which of the following is an example of managing earnings down? a. Changing estimated bad debts from 3 percent to 2.5 percent of sales. b. Revising the estimated life of equipment from 10 years to 8 years.
Math 540 Luevirta Hammonds Strayer University October 26, 2011 Days to Repair The days to repair is explained in the table below as follow: P(y) represent the days that is needed to repair the copier after it breaks down. Cumulative represent the increase in value of the probability distribution. Repair Time y represents the days it takes to repair the copier. P(y) Cumulative Repair Time (y) 0.2 .20 1 0.45 .65 2 0.25 0.90 3 0.1 1.00 4 1 2.75 The simulation in column one on the excel spreadsheet with the list of 100 breakdowns in 52 week which represent one year. In column C, RN1 (random numbers) generate numbers between zero and one and represent random numbers
If no dividends are paid in a given year, enter "0". Preferred dividends are paid before common dividends. With cumulative preferred dividends, if there are any dividends in arrears, they must be made up before common stockholders receive dividends. 25,000 x 2% x 130 = $65,000 dividends owe to preferred shareholders each year. 1st year 43,500 paid Preferred: 43,500 / 25,000 = $1.74 per share.
4. If you were opening a savings account with compound interest, would you prefer an account that offers annual compounding, quarterly compounding, or daily compounding? Why? (3-6 sentences. 2.0 points) I would like a quarterly compounding because my interest can pile up every 3 months.
This can be done by using the following formula: Minimum of Workstations = Σ for Task i Cycle time To find Cycle time the following formula is used: Cycle Time = Production Time Available Per Day Units Required Per Day Based on the information provided by Alistair Wu of a 40 hour work week and 6 work boots per hour we can conclude that the cycle time is 10 minutes per unit (480 minutes per day / 48 work boots per day). With that being said using the formula above, we can conclude that the minimum number of workstations required for the work boot assembly line is 4.6 or 5 stations. Reducing the number of stations from 8 to 5 would provide a drastic improvement in proficiency from 57.5% up to 92%. To verify my results and determine how the stations should be arranged I used POM for Windows Assembly Line Balancing Module. The results from POM are attached.
Inspection is estimated to be 3% of (labor) cost based on past experience = 258.60 9. General and Administrative expenses are estimated to be 5% of the total of (equipment / material) and (labor) based on past experience. = 3990.50 Note: For this problem, only items 5 and 6 are considered "labor" for the purpose of calculating items 8 and 9. Check answer: Total project cost = $94,737.60 2-2 Three-point Estimate Problem (a) A project requires the use of structural steel in several tasks over the 12 month period expected to complete the work. Based on recent experience the most likely price for the material is $0.30/lb.
The test market showed that only 6 percent of the market tried product and of those 6 percent 30 percent bought 3 times their initial purchase. Let us assume that the factors of the test market are mirrored once they distribute to the 19 cities in the southern tier of the U.S. Table 1 below shows the potential profits given the same variables as the test market with a few changes. The biggest change is the fixed costs adjusted for a bigger market. Since the new market is roughly 4 times the size of the test market, I multiplied the expenses to match the new market accordingly. The test market numbers given in Table 1 shows a loss of $1,204,150, which is mostly attributable to the high market expenses.