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Acc206 Week 5 Assignment

In: Business and Management

Submitted By KaliTurtle14
Words 399
Pages 2
Week 5 Assignment ACC206
1. Basic present value calculations
Future Value $12,000.00
Years: 5
Rate: 12%
Present Value = $6,809 Annual Cash Flow $16,000.00
Duration 12
Rate 14%
Present Value $90,565 Rate 10%
Year Cash Flows Present Value
0 $ - $ -
1 $15,000.00 $13,636.36
2 $ - $ -
3 $10,000.00 $7,513.15

Present value $21,150 Rate 16%
Year Cash Flows Present Value
0 $ - $ -
1 $8,000.00 $6,896.55
2 $8,000.00 $5,945.30
3 $8,000.00 $5,125.26
4 $10,000.00 $5,522.91 Present value $23,490

2. Cash flow calculations and net present value
A.
Year Cash Flow
20X1 ($10,000)
20X1 $1,300
20X2 $1,300
20X3 $14,550

B.
20X1 -10000 20X1 1120.69
20X2 966.1118
20X3 9321.569 1408.371

C.
Yes it was a good idea to require the stock because the NPV is positive.

3. Straightforward net present value and internal rate of return
NPV of Total Costs ($445,000.00) NPV of Total Savings $392,725.90 -$40,000 saved each year for 20 years. NPV of Cash Flows ($52,274.10) NPV is negative so it is not a good idea to acquire the landfill.

4. Straightforward net-present-value and payback computations
Revenues 600000
Variable cost 400 400000 fixed cost 160000 40000 120000
Total cash cost 520000
Year
0 -500000 1 (500000)
1-10 80000 5.22 417289.3
10 100000 0.269744 26974.38 NPV (55736.4)
Investment should not be made due to negative NPV.

5. Equipment replacement decision A. year
0 -67000 1 -67000
1 14900 0.892857 13303.57
2 14900 0.797194 11878.19
3 6200 0.71178 4413.038
4 6200 0.635518 3940.212
5 6200 0.567427 3518.047
6 6200...

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