Capital Budgeting Case QBR/501 Capital Budgeting Case Given two separate companies to compare I had to first crunch the numbers using the information on both companies that were proposed. The spending limit was $250,000 and I could not go over that amount. Corporation “A” had revenues equaling $100,000 in year one but increasing by 10% each year. It also had expenses of $20,000 and increasing by 15% each year. The depreciating expense is $5000 each year with a tax rate of 25% and discount rate of 10%.
734 812 + 50 + 1 062 328 = A 1 977 180 C 1 797 180 B 1 797 190 ( D 1 779 190 9. 2 450 000 − 36 000 − 300 500 = A 1 789 500 C 2 113 500 ( B 1 798 500 D 2 383 950 10. 158 780 ÷ 25 = 6 351 remainder . What is the number need to be written in the above? A 1 C 10 B 5 ( D 15 11.
1990 = 300,000 / 110,000 = 2.727 ii. 1991 = 280,000 / 290,000 = .966 B. Quick Ratio i. 1990 = (300,000 – 150,000) / 110,000 = 1.364 ii. 1991 = (280,000 – 150,000) / 290,000 = .448 C. Average Collection Period i.
They sell their t-shirts for $10. What is the least number of t-shirts they must sell to make a profit? 19. You have $12,000 to invest in two accounts. One account earns 6% interest a year, while a second, riskier account earns 10%.
2. (10 pts.) Referring to the table below, hiring a driver costs $10. Each machine costs $100. Which method should he use and why?
We created the following examples to show how WACC could potentially influence Marriott’s financial decisions: Suppose Marriott is taking on a project that requires a $100,000 initial investment, which produces cash inflows of $20,000 per year for 10 years. If we use Marriott’s current WACC of 9.29% the project would produce an NPV of $26,730. If we use the Target WACC, 10.24% for Marriott the NPV would be $21,634. Deciding based on the assumption of an NPV of $26K but it will actually achieve a NPV of $21K. Management will have to explain to shareholders why they were unsuccessful in achieving increased shareholder value.
Explain the difference in these two readings. 8. In the legend beneath Figure 2, the authors give an equation indicating that diastolic blood pressure is DBP = 25.8 + 0.13x. If the value of x is postnatal age of 30 hours, what is the value for Yˆ for neonates ≤ 1,000 grams? Show your calculations.
a. At 110% of capacity, an assistant department head will be needed at a salary of $10,500 annually. b. At 80% of capacity, the repairs expense will drop to onehalf of the amount at 100% capacity. (At other levels it is perfectly variable.)
The following formula is used to determine the cost in tens of thousands of dollars for refining 10,000 barrels at today’s market prices:[pic]. The variable “x” is for the percentage of capability used in the process. Enter the percentage as a whole number without the percentage sign when performing your calculation. a. What will be the cost to refine 10,000 barrels of oil from Alaska’s Prudhoe Bay, which requires 80% of the refinery’s capability?
Using these figures and assuming that both heavy and medium users (those buying between 1-9 pounds of cyano-acrylates per year) are potential customers; the maximum size of this market is estimated at 81,000 purchases. At 157.50 per unit, even with 100% penetration the market will not be worth more than $12.77 million in sales, with a more realistic estimate being $ 4 million in sales. The disparate nature of usage patterns across firms make it difficult to identify critical variables that can form the basis of segmenting the market. Possible ways to segment customers is on the basis of nature of the firm (small firm vs. large firm); sector of business (which industrial markets to target), current usage behavior (heavy CA usage vs low CA usage), nature of work (OEM vs MRO), and brand loyalty (SuperBonder usage vs competitors). Given that data about