100% Original, Plagiarism Free, Tailored to your instructions

Order Now!

The president of Real Time Inc. has asked you to evalu… Sh

The president of Real Time Inc. has asked you to evalu… Show more This data applies to the first six questions: The president of Real Time Inc. has asked you to evaluate the proposed acquisition of a new asset. The asset would require the use of an extra building that the firm is not presently using, but could be sold in the real estate market for $60,000. An analysis of the project showed the following data: MACRS class (depreciation): 3-year (33%, 45%, 15%, 7%) Economic Life: 4 years Price: $300,000 Freight and Installation: $30,000 Salvage Value: $60,000 Effect on NWC : Increase by $10,000 Revenues: $300,000/year (100,000 units at $3.00/unit) Costs excluding depreciation: $150,000/year (Fixed Cost $50,000; VC = $1.00/unit) Year 1 Depreciation $108,900.00 Year 2 Depreciation $148,500.00 Year 3 Depreciation $49,500.00 Year 4 Depreciation $23,100.00 Sale Price of Building $60,000.00 Tax rate: 40% Cost of capital 10% The Project Cash Flow Table below is provided to assist you in calculating the relevant after-tax cash flows, and then answer the questions concerning investment cost, cash flows, and net present value. Year 0 1 2 3 4 Total Revenues Operating Costs (exc. dep) Depreciation Earnings before taxes Taxes Net income Depreciation Net operating cash flows Equipment Cost Installation Change in Net Working Capital Opportunity Cost of Project Salvage Value Tax on Salvage Value Return of NWC NET CASH FLOWS Question 5 What is the final cash flow in year 4. Answer $195,240 $265,240 $205,240 $225,240 4 points Question 6 What is the project’s NPV? Answer $56,580 $60,740 $67,570 $77,580 $127,570 4 points Question 7 After seeing your analysis, the president asked you to recalculate the NPV if the sales volume is only 80,000 units per year instead of 100,000. This is an example of (or a component of) Answer Breakeven analysis Sensitivity analysis Scenario analysis Extreme insensitivity to the amount of work you put into evaluating the project 2 points Question 8 After you reevaluated the project based on the lower sales volume, the president asked you to reevaluate the project again, this time considering a lower and higher sales price, a higher and lower variable cost, a higher and lower fixed cost, and a lower and higher salvage value, showing the difference in NPV for the change in each variable. This exercise is an example of Answer Breakeven analysis Sensitivity analysis Scenario analysis A complete waste of time 2 points Question 9 Impressed by your analysis of how each assumption affects NPV, the boss then asks you to recalculate NPV based on the worst case sales volume, worst case variable cost, and worst case sales price representing an overall downturn in market demand combined with inflationary input markets. In response to this request, you will perform Answer Breakeven analysis Sensitivity analysis Scenario analysis A task unworthy of a professional financial manager with your talents and skills 2 points Question 10 Finally, after you have taken blood pressure medication to deal with the stress of excessive demands and lack of recognition of your many valuable contributions, your boss asks you to calculate, based on the expected values for the sales price and fixed and variable costs, the sales volume required for the net income from the project to cover the cost of the investment. She has requested that you perform Answer Breakeven analysis Sensitivity analysis Scenario analysis One more unnecessary exercise in futility that will be completely ignored by the capital budgeting committee regardless of the amount of time it takes you to complete the analysis. 2 points Question 11 A recurring financial theme from Scripture that was repeated in many of the devotions during the semester was: Answer we should tithe at least 10% of our income. wealth oftn indicates a materialistic attitude. debt should be undertaken only after careful consideration. we should view ourselves as managers rather than owners of our economic resources. • Show less

Our Service Charter

  1. Excellent Quality / 100% Plagiarism-Free

    We employ a number of measures to ensure top quality essays. The papers go through a system of quality control prior to delivery. We run plagiarism checks on each paper to ensure that they will be 100% plagiarism-free. So, only clean copies hit customers’ emails. We also never resell the papers completed by our writers. So, once it is checked using a plagiarism checker, the paper will be unique. Speaking of the academic writing standards, we will stick to the assignment brief given by the customer and assign the perfect writer. By saying “the perfect writer” we mean the one having an academic degree in the customer’s study field and positive feedback from other customers.
  2. Free Revisions

    We keep the quality bar of all papers high. But in case you need some extra brilliance to the paper, here’s what to do. First of all, you can choose a top writer. It means that we will assign an expert with a degree in your subject. And secondly, you can rely on our editing services. Our editors will revise your papers, checking whether or not they comply with high standards of academic writing. In addition, editing entails adjusting content if it’s off the topic, adding more sources, refining the language style, and making sure the referencing style is followed.
  3. Confidentiality / 100% No Disclosure

    We make sure that clients’ personal data remains confidential and is not exploited for any purposes beyond those related to our services. We only ask you to provide us with the information that is required to produce the paper according to your writing needs. Please note that the payment info is protected as well. Feel free to refer to the support team for more information about our payment methods. The fact that you used our service is kept secret due to the advanced security standards. So, you can be sure that no one will find out that you got a paper from our writing service.
  4. Money Back Guarantee

    If the writer doesn’t address all the questions on your assignment brief or the delivered paper appears to be off the topic, you can ask for a refund. Or, if it is applicable, you can opt in for free revision within 14-30 days, depending on your paper’s length. The revision or refund request should be sent within 14 days after delivery. The customer gets 100% money-back in case they haven't downloaded the paper. All approved refunds will be returned to the customer’s credit card or Bonus Balance in a form of store credit. Take a note that we will send an extra compensation if the customers goes with a store credit.
  5. 24/7 Customer Support

    We have a support team working 24/7 ready to give your issue concerning the order their immediate attention. If you have any questions about the ordering process, communication with the writer, payment options, feel free to join live chat. Be sure to get a fast response. They can also give you the exact price quote, taking into account the timing, desired academic level of the paper, and the number of pages.

Excellent Quality
Zero Plagiarism
Expert Writers

Instant Quote

Single spaced
approx 275 words per page
Urgency (Less urgent, less costly):
Total Cost: NaN

Get 10% Off on your 1st order!