A financial manager is considering a proposal from her Chief Operating Officer (COO) to purchase precision testing equipment. The financial manager with the assistance of operations has estimated the cash flow benefits, namely the cost savings from fewer production defects, of the new equipment. The Present Value (PV) of the these positive cost savings over the next 10 years is estimated to be $455,000 based on the firm's cost of capital of 7%. Which of the following statements is true?

a. If the total cost of the equipment, including the costs of installation and set up, are equal to or less than the estimated PV of the cost savings $755,000, the financial manager should recommend the proposal to the COO and senior management.
b. If the total cost of the equipment, including the costs of installation and set up, are significantly greater than the estimated PV of the cost savings $755,000, the financial manager should recommend the proposal to the COO and senior management.
c. If the total cost of the equipment, including the costs of installation and set up, are significantly greater than the estimated PV of the cost savings $755,000, the financial manager should NOT recommend the proposal to the COO and senior management.
d. If the total cost of the equipment, including the costs of installation and set up, are equal to or less than the estimated PV of the cost savings $755,000, the financial manager should NOT recommend the proposal to the COO and senior management.

Answers

Answer 1

Answer:

c

Explanation:

Only a profitable investment would be accepted by a firm. this is because the aim of a firm is to earn profit

for a project to be accepted, the present value of cost savings has to be greater than the total amount invested in the project. Thus, the NPV of a project should be positive if it is to be accpeted

Net present value is the present value of after-tax cash flows from an investment less the amount invested.


Related Questions

According to the text, all of the following are ways managers can improve their writing skills EXCEPT: a. respecting the reader. b. writing lengthy explanations. c. knowing your point and get to it. d. getting a second opinion. e. writing clearly rather than impressively.

Answers

Answer:

According to the text, all of the following are ways managers can improve their writing skills EXCEPT:

b. writing lengthy explanations.

Explanation:

The key to successful business reports is writing briefly.  Managers who write lengthy explanations will not get the attention of their readers.   Business reports should be highly summarized, concise, and be relevant at all times.  A brief report respects the reader's time.  It shows that the writer knows the relevant points to include.

As a marketing term, __________ generally includes not only physical goods, but also services and ideas. Multiple Choice marketing invention merchandise product concept

Answers

Answer:

product

Explanation:

The product is an item that the company offer to its customer for buying the product. It is not only the goods that to be kept physically but it also consist of the services and ideas so that it become differentiate with the competitor. The product can be differentiate in terms of cost, quality, quantity, presentable form via having the innovative ideas

So, the 2nd last option is correct

spectrum corp desires a 25% target gross profit after covering all product costs: considering the total product costs assigned to the products c and d, what would spectrum have to charge the customer to achieve that gross profit

Answers

Answer:

Note: "The full question is attached as picture below"

Required selling price for product = Total product cost / Product cost as a percentage of selling price

Note: When the gross profit rate is 25%, this means that Product cost as a percentage of selling price is 75%

Total cost assigned for product C = $1,396

Total cost assigned for product D = $3,158

What would Oak have to charge the customer to achieve that gross profit?

Charge to the customer for Product C:

= $1,396 / 0.75

= $1861.333333333333

= $1,861.33

Charge to the customer for Product D:

= $3,158 / 0.75

= $4210.666666666667

= $4,210.67

declared a $0.70 per share cash dividend on its $1 par common stock. On the date of declaration, there were 50,000 shares authorized, 14,000 shares issued, and 5,600 shares held as treasury stock. What is the entry for the dividend declaration

Answers

Answer:

Debit Retained Earnings $5,880; credit Common Dividends Payable $5,880.

Explanation:

Based on the information given the appropriate

Journal entry for the dividend declaration will be:

Debit Retained Earnings $5,880

Credit Common Dividends Payable $5,880.

(To record dividend declaration)

$0.70 * (14,000 shares - 5600 shares)

= $0.70*8,400

=$5,880

What do construction workers manufacturing workers and farmers have in common?

Answers

Answer:

Depression. Unfortunately, construction workers have higher rates of depression than many other occupations the other occupation at a high risk include farming.

According to the most recent data available, construction and farming occupation also carry the highest rate of depression because the stress to have this type of physical work as well as mental, is very strenuous because of the high productivity demands to meet deadlines, finish contacts and making sure your finances are reached. These type of occupations, in certain cases cause great levels of depression.

Explanation:

I majored in Business

On December 31, 2021, Coolwear Inc. had balances in Accounts Receivable and Allowance for Uncollectible Accounts of $46,500 and $1,550, respectively. During 2022, Coolwear wrote off $550 in accounts receivable and determined that there should be an allowance for uncollectible accounts of $5,700 at December 31, 2022. Bad debt expense for 2022 would be:

Answers

Answer:

$4,700

Explanation:

Calculation to determine what the Bad debt expense for 2022 would be:

Using this formula

2022 Bad debt Expense =Allowance for uncollectible accounts-(Balance in Allowance for Uncollectible Accounts -Accounts receivable written off)

Let plug in the formula

2022 Bad debt Expense$5,700-($1,550-$550)

2022 Bad debt Expense=$5,700-$1,000

2022 Bad debt Expense=$4,700

Therefore Bad debt expense for 2022 would be:$4,700

Lake Incorporated purchased all of the outstanding stock of Huron Company paying $961,000 cash. Lake assumed all of the liabilities of Huron. Book values and fair values of acquired assets and liabilities were: Book Value Fair Value Current assets (net) $ 130,300 $ 124,700 Property, plant, equip. (net) 614,000 769,000 Liabilities 151,800 175,000 Lake would record goodwill of:

Answers

Answer:

$242,300

Explanation:

Goodwill = Purchase Price - Net Assets taken over at Fair Value

where,

Purchase Price = $961,000

Net Assets taken over at Fair Value = $ 124,700 + $769,000 - $175,000 = $718,700

therefore,

Goodwill = $961,000 - $718,700 = $242,300

conclusion :

Lake would record goodwill of $242,300

Dan receives a proportionate current (nonliquidating) distribution when the basis of his partnership interest is $30,000. The distribution consists of $10,000 in cash and property with an adjusted basis to the partnership of $24,000 and a fair market value of $26,500. Dan's basis in the noncash property is: Question 22 options: $26,500. $24,000. $20,000. $10,000. $0.

Answers

Answer:

$20,000

Explanation:

Calculation to determine what Dan's basis in the noncash property is:

Using this formula

Basis=Partnership interest basis -Cash

Let plug in the formula

Basis=$30,000-$10,000

Basis=$20,000

Therefore Dan's basis in the noncash property is: $20,000

Cutter Enterprises purchased equipment for $54,000 on January 1, 2021. The equipment is expected to have a five-year life and a residual value of $3,300. Using the double-declining-balance method, depreciation for 2021 and the book value at December 31, 2021, would be:

Answers

Answer:

the depreciation expense for the year 2021 and the book value for the year 2021  is $21,600 and $32,400 respectively

Explanation:

The computation of the depreciation expense for the year 2021 and the book value for the year 2021 under double-declining method is given below:

The depreciation expense is

= $54,000 × 1 ÷ 5 × 2

= $21,600

Now the book value is

= $54,000 - $21,600

= $32,400

hence, the depreciation expense for the year 2021 and the book value for the year 2021  is $21,600 and $32,400 respectively

Using the high-low method, Company X has determined the variable portion of its cost formula for electricity to be $2 per unit. For the month of July Company X estimates that total electricity cost will amount to $66,000 based on producing 30,000 units. The amount of fixed electricity cost estimated for July is:

Answers

Answer:

Fixed cost= $6,000

Explanation:

Giving the following information:

July:

Total cost= $66,000

Number of units= 30,000

Varaible cost per unit= $2

First, we need to calculate the total variable cost:

Total variable cost= 2*30,000

Total variable cost= $60,000

Now, the fixed cost:

Fixed cost= 66,000 - 60,000

Fixed cost= $6,000

Quantum Inc. has warrants outstanding that allow the holder to purchase 1.5 shares of stock per warrant at $30 per share (exercise price). Thus, each individual share can be purchased at $30 with the warrant. The common stock is currently selling for $36. The warrant is selling for $12.

Required:
a. What is the intrinsic (minimum) value of this warrant?
b. What is the speculative premium on this warrant?
c. What should happen to the speculative premium as the expiration date approaches?

Answers

Answer:

A. $9.00

B. $3.00

C. Decrease

Explanation:

a. Calculation to determine the intrinsic (minimum) value of this warrant

Using this formula

I = (M – E) × N

Where,

I represent Intrinsic value of a warrant

M represent Market value of common stock

E represent Exercise price of a warrant

N represent Number of shares each warrant entitles theholder to purchase

Let plug in the formula

I=($36 – $30) *1.5

I=$6*1.5

I = $9.00

Therefore the intrinsic (minimum) value of this warrant is $9.00

b. Calculation to determine the speculative premium on this warrant

Using this formula

S = W – I

Where,

S representSpeculative premium

W represent Warrant price

I represent Intrinsic value.

Let plug in the formula

S=$12-[($36 – $30) *1.5]

S=$12 – $9

S = $3.00

Therefore the speculative premium on this warrant is $3.00

c.What should happen to the SPECULATIVE PREMIUM as the expiration date approaches is for it to DECREASE and thereby approach $0.

An entrepreneur is someone who develops a business around an innovation. They manage the business and assume the risk for its success.
O True
O False

Answers

Answer:

true

Explanation:

the exact definition of an entrepreneur is: a person who organizes and operates a business or businesses, taking on greater than normal financial risks in order to do so.

Answer: The answer is true an entrepreneur who take risk at being successful as make a living own their own

PERSONAL FINANCE 10 POINTS// WILL GIVE BRAINLIEST

What is likely to be TRUE about making financial decisions as people get older?

A.
Financial decisions become bigger and more complex.

B.
Making decisions is easier as there are fewer risks involved.

C.
There are fewer major decisions to make.

D.
Financial situations will be simpler with fewer consequences.

Answers

I believe it is A, as somebody whose watched adults I have gained intel about the lives and many say that financial decisions become harder! hoped this helped

Financial decisions become bigger and more complex.

When linking operations to business strategies, the order winner of the product imitator strategy, is _____ for the customer, whereas the order winner of the product innovator strategy is ______.

Answers

Answer:

The question is incomplete, the options are missing. The options are the following:

a) Flexibility; price

b) Flexibility; quality

c) Quality; price

d) Price; quality

e) Price; flexibility

And the correct answer is the option E: Price; flexibility.

Explanation:

To begin with, in the field of business management the term known as "product imitator strategy" refers to a type of technique or strategy used by the companies in the situation where the want to reproduce a product that is imitating the product of the leader company of the industry. It is a very common and used method in most of the industries due to the fact that it happens when many companies try to produce a product that is similar to the ones of Apple for example. And when it comes to this strategy the most important matter for the customer is the price while for the for the product innovator strategy is the flexibility of it.

Peter, Paul, and Mary go to an all-you-can-eat buffet. The normal entrance fee is $20, but Peter gets in free because it is his birthday and they have a special. Paul uses a coupon and only pays $10. Mary is the only one to pay the full $20. They are all equally hungry and have an equally large appetite. If they are all rational decision makers, the person who should eat the most is:

Answers

Answer:

mary

Explanation:

A rational consumer would consume up to the point that marginal benefit equal marginal cost

Mary paid $20. this means that she places a value of $20 on the meal.

Paul paid $10. this means that he places a value of $10 on the meal

The value Mary places is 20, so she places a higher value and she would consume the most

Peter enters free and thus there is no marginal cost attached to this decision. He should consume the least

Trevor Company expects sales of Product W to be 64,000 units in April, 79,000 units in May, and 74,000 units in June. The company desires that the inventory on hand at the end of each month be equal to 40% of the next month's expected unit sales. Due to excessive production during March, on March 31 there were 29,000 units of Product W in the ending inventory. Given this information, Trevor Company's production of Product W for the month of April should be:

Answers

Answer:

66,600 units

Explanation:

Sales for April = 64,000 units

Closing Inventory Required at end of April = 31,600 units (79,000*40%)

Units Required = 64,000 units + 31,600 units

Units Required = 95,600 units

Units Need to be produced = Units Required - Units Available now

Units Need to be produced = 95,600 units - 29,000 units

Units Need to be produced = 66,600 units

So, trevor Company's production of Product W for the month of April should be 66,600 units.

6. The construction and engineering industry has been slow to innovate and change over the years, however more recently the industry has started
to experiment with

Answers

Answer:

soing bussneses

Explanation:

maybe?

ways to increase job satisfaction for managers​

Answers

Answer:

Rephrase please

Explanation:

Recognize and Celebrate Your Employees

The balance sheet of Subsidiary shows assets of $86,400 and liabilities of $15,000. The fair value of the assets is $90,000 and the fair value of its liabilities is $15,000. Parent paid $95,000 to acquire Subsidiary. Parent should record goodwill on this purchase of:______.
A) $23,600.
B) $20,000.
C) $3,600.
D) $5,000.

Answers

Answer:

b. $20,000

Explanation:

Goodwill = Investment in Subsidiary - (Asset With book value - Liability with book value) - (Fair value of Asset - Book value of Asset)

Goodwill = $95,000 - ($86,400 - $15,000) - ($90,000 - $86,400)

Goodwill = $95,000 - $71,400 - $3,600

Goodwill = $20,000

So, parent should record goodwill on this purchase of $20,000

What is the term for the aesthetic that emerged with technological innovations and through mass media and entertainment, avoiding any reference to past fashion, instead focusing on sleekness, banishment of frills, functional details, and performance and technical fabrics

Answers

Group of answer choices.

a. Avant-Garde

b. Zeitgeist

c. Modern

d. Post-Modern

Answer:

c. Modern.

Explanation:

A product can be defined as any physical object or material that typically satisfy and meets the demands, needs or wants of customers. Some examples of a product are mobile phones, television, microphone, microwave oven, bread, pencil, freezer, beverages, soft drinks etc.

According to the economist Philip Kotler in his book titled "Marketing management" he stated that, there are five (5) levels of a product. This includes;

1. Core benefit.

2. Generic product.

3. Expected product.

4. Augmented product.

5. Potential product.

The core benefit of a product can be defined as the basic (fundamental) wants or needs that is being satisfied, met and taken care of when a customer purchase a product.

Innovation typically involves the creation of a new product of any category such as automobile, building, phones, electronics, etc., that generates money for the innovators or manufacturers through purchase made by the end users (consumers).

Modern is the term used to describe an aesthetic (artistic goods or products) that emerged with technological innovations and through mass media and entertainment, avoiding any reference to past fashion, instead focusing on sleekness, banishment of frills, functional details, and performance and technical fabrics.

This ultimately implies that, the product isn't obsolete in nature but designed and developed to meet new tastes.

In response to dwindling sales of organic meats, Hain Celestial executives decided to promote the sale of organically grown nuts as an alternative source of protein, which is an excellent example of a firm's:

Answers

Answer:

Product substitute

Explanation:

Product substitute is defined as one that meets similar needs of the consumer. As demand for one of such goods rises the demand of the other tends to fall as the meet similar needs.

In the given scenario organic meats are seen as being substituted by organically grown nuts as a source of protein.

So when Hain Celestial has dwindling sales of organic meats they were considering organically grown nuts as a different product to give to customers

A very large company would be most likely to have a(n) ___ at the ahead of its accounting department.

A. Executive vice president
B. Controller
C. Chief financial officer
D. Accounting manager

Answers

A very large company would be most likely to have a Chief financial officer as the head of its accounting department.

The Chief Financial Officer (CFO) would most likely be in charge of the accounting division of a very large corporation. A company's Chief Financial Officer (CFO) is in charge of all financial operations, including accounting, budgeting, financial reporting, and forecasting. The day-to-day accounting activities of a corporation are managed by the controller, who holds a mid-level role. The basic duties of the accounting manager include leading a group of accountants and supervising the creation of financial statements and reports. Even though the executive vice president may be in charge of the entire organization, they could not have specific knowledge of accounting and finance.

A Chief Financial Officer (CFO) is a senior executive accountable for directing the financial actions of a firm. Monitoring cash flow, assessing the firm's financial advantages and disadvantages, and creating strategies for financial expansion are all tasks assigned to the CFO. Also, they are in charge of supervising the creation of predictions and current financial reports. In conclusion, the CFO is essential to the efficient management of a company's finances.

To learn more about Chief Financial Officer, click below:

https://brainly.com/question/30711143

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Help please!! I’ll give Brainliest!

2. Give two reasons that a business might not be able to stick to its budget. Then recommend one strategy to address the reasons you provided.

Answers

Answer:

1.You’re unrealistic. We all want to be able to have unlimited amounts of money.

2. You think budgeting is too complicated. Don’t be scared. Budgets are fun!

Explanation:

Strategy: Take it slow and go with the flow don't get so excited about the fact of making money.

Answer:

1.You’re unrealistic. We all want to be able to have unlimited amounts of money.

2. You think budgeting is too complicated. Don’t be scared. Budgets are fun!

(Strategy: Take it slow and go with the flow don't get so excited about the fact of making money.)

Credit goes to marilynnargi!

An order taker at a producer of bed linens receives an order from a retailer for
6,500 pillows to be shipped to the retailer's warehouse. The retailer will pay
for shipping. Which channel member is most likely to set requirements for
routing?
A. The retailer
OO
B. The producer
C. The wholesaler
D. The consumer

Answers

Answer: The retailer

Explanation:Ape

Silver Corporation incurred costs of $600,000 for managing the wholesale division during the year. The customer details of the company were as follows: X Y Z Sales $600,000 $400,000 $200,000 COGS $40,000 $20,000 $15,000 How much cost will be allocated to customer Y, if a cause-effect relationship cannot be established with any cost driver

Answers

Answer: $200,000

Explanation:

The cost will be allocated to customer Y, if a cause-effect relationship cannot be established with any cost driver will be calculated thus:

Total sales = $600,000 + $400,000 + $200,000 = $1,200,000

The percentage of Y on total sales will be:

= $400,000/$1,200,000 × 100

= 1/3 × 100

= 33.33%

Therefore, the cost that's allocated to Y will then be:

= $600,000 × 33.33%

= $600,000 × 0.3333

= $200,000

Therefore, the correct answer is $200,000

Rex and Dena are married and have two children, Michelle (age seven) and Nancy (age five). During 2020, Rex earned a salary of $26,500, received interest income of $300, and filed a joint income tax return with Dena. Dena had $0 gross income. Their earned income credit for the year is: a.$5,587. b.$5,920. c.$5,650. d.$0.

Answers

Answer:

Their earned income credit for the year is:

b. $5,920.

Explanation:

Rex's earned salary =    $26,500

Interest income =                  300

Dena's gross income =             0

Total earned income = $26,800

Two children aged seven and five

Since their earned income is less than $47,440 and they have two qualifying children, their earned income credit for 2020 is determined as $5,920 from the table of 2020 Income Limits and Range of Earned Income Tax Credit (EITC).

Suppose the U.S. supply of loanable funds shifts left. This will Group of answer choices increase U.S. net capital outflow and increase the quantity of loanable funds demanded. increase U.S. net capital outflow and decrease the quantity of loanable funds demanded. decrease U.S. net capital outflow and decrease the quantity of loanable funds demanded. decrease U.S. net capital outflow and increase the quantity of loanable funds demanded.

Answers

Answer:

Decreases U.S. net capital outflow and decrease the quantity of loanable funds demanded.

Explanation:

When U.S. supply of loanable funds shift left the net capital outflow will decrease. This will cause decline in the quantity of loanable funds demanded. The U.S. net capital outflow will increase when the U.S. supply of loanable fund shifts right.

A company issues a ten-year $1,000 face value bond at par with a coupon rate of 6.7% paid semiannually. The YTM at the beginning of the third year of the bond (8 years left to maturity) is 8.1%. What was the percentage change in the price of the bond over the past two years

Answers

Answer:

-8.13%

Explanation:

The computation of the percentage change in the price of the bond is shown below;

Given that

Face Value = $1,000

Annual Coupon Rate = 6.7%

Semi-annual Coupon Rate = 3.35%

Semi-annual Coupon = 3.35% × $1,000 = $33.50

Now  

After 2 years:

Annual YTM = 8.1%

Semi-annual YTM = 4.05%

Price of Bond = $33.50 × PVIFA(4.05%, 16) + $1,000 ×PVIF(4.05%, 16)

= $33.50 × (1 -(1 ÷ 1.0405)^16) ÷ 0.0405 + $1,000 ÷ 1.0405^16

= $918.73

Now

Change in Price = ($918.73 - $1,000) ÷ $1,000

= -8.13%

The run-time stack:_______
A. points out syntax errors in a Java program
B. helps keep track of the execution of recursive and non-recursive programs
C. only helps in the execution of recursive programs
D. is part of the Java API

Answers

b. Helps keep track of the execution of recursive and non recursive programs

Paul, a calendar year single taxpayer, has the following information for 2020: AGI $175,000 State income taxes 13,500 State sales tax 3,000 Real estate taxes 18,900 Gambling losses (gambling gains were $12,000) 6,800 Paul's allowable itemized deductions for 2020 are: a.$16,800. b.$39,200. c.$10,000. d.$42,200.

Answers

Answer:

b.$39,200

Explanation:

Calculation to determine Paul's allowable itemized deductions for 2020

Using this formula

2020 itemized deductions=State income taxes+Real estate taxes+Gambling losses

Let plug in the formula

2020 itemized deductions=$13,500+$18,900+$6,800

2020 itemized deductions=$39,200

Therefore Paul's allowable itemized deductions for 2020 are $39,200

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