QuickHelper

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About QuickHelper

Levels Tought:
Elementary,High School,College,University,PHD

Expertise:
Accounting,Applied Sciences See all
Accounting,Applied Sciences,Business & Finance,Chemistry,Engineering,Health & Medical Hide all
Teaching Since: May 2017
Last Sign in: 356 Weeks Ago, 3 Days Ago
Questions Answered: 20103
Tutorials Posted: 20155

Education

  • MBA, PHD
    Phoniex
    Jul-2007 - Jun-2012

Experience

  • Corportae Manager
    ChevronTexaco Corporation
    Feb-2009 - Nov-2016

Category > Accounting Posted 05 Jun 2017 My Price 9.00

Quick Sale Real Estate Company is planning to invest in a new development.

Question description

 

 

 

QUESTION 1 (1 POINT)

 Question 1 Unsaved

 

 

Quick Sale Real Estate Company is planning to invest in a new development. The cost of the project will be $23 million and is expected to generate cash flows of $14,000,000, $11,750,000, and $6,350,000 over the next three years. The company's cost of capital is 20 percent. What is the internal rate of return on this project? (Round to the nearest percent.)

Question 1 options:

 

 

20%

 
 

 

24%

 
 

 

22%

 
 

 

28%

 

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QUESTION 2 (1 POINT)

 Question 2 Unsaved

 

 

Muncy, Inc., is looking to add a new machine at a cost of $4,133,250. The company expects this equipment will lead to cash flows of $816,822, $863,275, $937,250, $1,019,110, $1,212,960, and $1,225,000 over the next six years. If the appropriate discount rate is 15 percent, what is the NPV of this investment?

Question 2 options:

 

 

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QUESTION 3 (1 POINT)

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Given the following cash flows for a capital project, calculate the IRR using a financial calculator

Year

0

1

2

3

4

5

Cash Flows

($50,467)

$12,746

$14,426

$21,548

$8,580

$4,959

 

Question 3 options:

 

 

8.41%

 
 

 

8.05%

 
 

 

8.79%

 
 

 

7.9%

 

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QUESTION 4 (1 POINT)

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An investment of $83 generates after-tax cash flows of $44.00 in Year 1, $64.00 in Year 2, and $133.00 in Year 3. The required rate of return is 20 percent. The net present value is

Question 4 options:

 

 

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QUESTION 5 (1 POINT)

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Cortez Art Gallery is adding to its existing buildings at a cost of $2 million. The gallery expects to bring in additional cash flows of $520,000, $700,000, and $1,000,000 over the next three years. Given a required rate of return of 10 percent, what is the NPV of this project?

Question 5 options:

 

 

-$197,446

 
 

 

$1,802,554

 
 

 

$197,446

 
 

 

-$1,802,554

 

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QUESTION 6 (1 POINT)

 Question 6 Unsaved

 

 

Which ONE of the following statements about the payback method is true?

Question 6 options:

 

 

The payback method is consistent with the goal of shareholder wealth maximization

 
 

 

The payback method represents the number of years it takes a project to recover its initial investment plus a required rate of return.

 
 

 

There is no economic rational that links the payback method to shareholder wealth maximization.

 
 

 

None of these statements are true.

 

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QUESTION 7 (1 POINT)

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McKenna Sports Authority is getting ready to produce a new line of gold clubs by investing $1.85 million. The investment will result in additional cash flows of $525,000, $817,500, and $1,215,000 over the next three years. What is the payback period for this project?

Question 7 options:

 

 

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QUESTION 8 (1 POINT)

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Monroe, Inc., is evaluating a project. The company uses a 13.8 percent discount rate for this project. Cost and cash flows are shown in the table. What is the NPV of the project?

Year            Project

  0              ($11,368,000)

  1               $  2,172,590

  2               $  3,787,552

  3               $ 3,225,650

  4               $  4,115,899

  5               $  4,556,424

Question 8 options:

 

 

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Answers

QuickHelper
(10)
Status NEW Posted 05 Jun 2017 02:06 PM My Price 9.00

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