# Chapter 9 Homework Key

Submitted By johnnymystery
Words 1688
Pages 7
Chapter 9 Homework key
I’ve edited the questions as indicated on the assignment web page. Also note that many of the present values in the key here are shown in the key using PV factors from tables. I expect you to do the problems with your calculator and show your calculator inputs and the result.

1. A project has the following cash flows C0 C1 C2 C3 (\$700) \$200 \$500 \$244 a. What is the project’s payback period? b. Calculate the projects NPV at 12%. c. Calculate the project’s IRR

SOLUTION:
a. The cumulative cash flow is Year 0 1 2 3 Cash Flow (\$700) \$200 \$500 \$244 Cumulative (\$700) (\$500) 0 \$244
Cumulative cash flow is zero after two years, hence the payback period is two years.

b. Year Ci PVFk,i Ck,i ( PVFk,i 0 (\$700) 1.0 (\$700) 1 \$200 .8929 \$179 2 \$500 .7972 \$399 3 \$244 .7118 \$174 NPV = \$ 52

c. With the cash flows above entered in your calculator, hit the IRR key and find that the IRR is 16.03%

3. Clancy Inc. is considering a project with the following cash flows. C0 C1 C2 C3 (\$7,800) \$2,300 \$3,500 \$4,153

a. Clancy has a policy of rejecting all projects that don’t pay back within three years outright, and analyzing those that do more carefully with time value based methods. Does this project warrant further consideration? b. Should Clancy accept the project based on its NPV if the company’s cost of capital is 8%? c. Based on IRR, what conclusion will the firm reach?

SOLUTION:
a. The cumulative cash flow is Year 0 1 2…...

### Similar Documents

#### Acc 557 Entire Course Financial Accounting

...https://homeworklance.com/ ) Email us At: Support@homeworklance.com or lancehomework@gmail.com ACC 557 Financial Accounting Assignments , Discussions, Homework and Quizzes ACC 557 Week 1 DQ1 Improper or Illegal Methods From the e-Activity, identify the company, the accounting impropriety or illegality, how it was detected, the outcome, and propose a strategy that might have prevented the situation. Indicate how the strategy should be implemented.Assess the impact to the company’s financial performance based on the impropriety and the resulting effect to stakeholder confidence in management, recommending how the company can minimize the resulting impact to the business. ACC 557 Week 1 DQ2 General Accounting Principles “Bookkeeping and accounting are the same.” In terms of your role in the provision of financial services, present data to support the accuracy of this statement and support your position.Analyze the accounting equation as a concept that underpins the work of professional accountants and how an understanding of the equation can impact business decision making. ACC 557 Week 1 Homework Chapter 1 (E1-4,E1-7,E1-11,P1-2A) ACC 557 Week 2 ACC 557 Week 2 Homework Chapter 2 (E2-6,E2-9,E2-11,P2-2A) ACC 557 Week 2 Homework Chapter 3 (E3-6,E3-7,E3-11,P3-2A) ACC 557 Week 2 Quiz – Chapter 1 ACC 557 Week 3 ACC 557 Week 3 DQ1 Researching Financial Information From the e-Activity, analyze one company’s......

Words: 2032 - Pages: 9

#### Hihihi

...PARKLAND COLLEGE FINANCIAL ACCOUNTING ACC 101(Fall 2015) TENTATIVE SYLLABUS Instructor: Nancy Schrumpf, CPA Office Hours: Office: B120 MW 8-9 a.m. Phone: 351.2576 MW11 a.m.-12:30 p.m. Secretary/Mailbox: 351.2213, B116 or by appointment Email: nschrumpf@parkland.edu[->0] . Course Web Site: http://my.parkland.edu Login using your Parkland College student email account username and password. You should find a link to “Cobra Learning” on the page which will take you to your course schedule. Select this course to access course materials. You can also access the course from Cobra.parkland.edu. COURSE COMMUNICATION: All course email will be using your CobraLearning account, so please check it regularly. I will generally check my email daily Monday through Friday. COURSE DESCRIPTION: Financial Accounting: (IAI BUS 904) Financial statements as related to investors, creditors and managers, includes cash, receivables, inventory, noncurrent assets, investments, liabilities and equities. F,S,Su COURSE OBJECTIVES: Construct, interpret and analyze the income statement, balance sheet, stockholder’s equity statement and cash flow statement for service business and merchandising business Construct, interpret and analyze period-end adjustments (accruals and deferrals), periodic and perpetual inventory methods, receivables, cash, long-term assets, liabilities (short-term, long-term and contingent), stockholder’s equity and various financial......

Words: 2147 - Pages: 9

Free Essay

#### Report

...harvard.edu; section meeting time, Tuesday 7:00-9:00 p.m. - Colin Codner (students with last names starting with P-Z): ccodner@fas.harvard.edu; - section meeting time, Monday 8:00-10:00 p.m. - Susan Goldstein: goldstein@dcemail.harvard.edu; Canvas and Connect contact, no sections All sections will take place online through the web conference platform, Big Blue Button. Attend by clicking on the link in the email you receive before every section meeting or by clicking on “Conferences” in the left navigation panel of the Canvas site and then clicking the “join” button in the middle of the page. Recorded Sections: Available on the course website four-five hours after the section concludes. Access the recordings by clicking on “Conferences” in the left navigation panel of the Canvas site. Please contact TAs for any questions regarding homework, quizzes, exams, and other course related matters. Please contact Susan Goldstein for any technical questions related to Canvas, Connect, or Big Blue Button. In the event Susan is unable to respond or solve Connect questions, please contact Connect (McGraw Hill) directly. See Canvas for more details. Textbook: Online version through Connect, published by McGraw Hill Financial Accounting, 8th edition, by Libby, Libby, and Short. Note that purchase of the hard copy textbook is optional. Connect access comes with an online textbook. See Canvas for further details. Homework, Quizzes, and Exams: These will be......

Words: 1440 - Pages: 6

#### Auditing Syllabus

... 70 points Final Exam 70 points Quizzes 25 points Homework 20 points Team 5 points Total 260 points A = Good 90% of course points B = Above Average 80% of course points C = Average 70% of course points D = Below Average 60% of course points In = Incomplete assigned only under conditions specified in the University catalog. NO CURVE Keys to Success: Exams will be based on textbook, lectures, and homework assigned. Expect the reading of each assignment to take two to three hours to complete and another hour to complete the assigned homework. Here are my guidelines to class participation: Homework Read the assigned chapter prior to attempting the questions and problem assigned from the textbook. Other random class assignments may or may not require textbook readings. All work has to be completed to the best of your ability before you come to class so that you can participate in class activities and discussions. Homework assignments are due per schedule on syllabus and may be collected randomly. You will be given the opportunity to earn a total of 25 points toward your final grade for homework assignments you complete and turn in on the day collected. No Exceptions. Only you may turn in your own homework, do not ask anyone to turn in your work you or you turn in someone’s work for them. Some homework points will come from working on an audit case throughout the semester...

Words: 1036 - Pages: 5

#### ; Flmvg

...[pic] Accounting and MIS 626: Tax Accounting I Course Syllabus - Autumn 2010 Tues/Thurs 7:30 -9:18 am – Schoenbaum Hall 205 Instructor: Stephanie L. Brewer, CPA, CVA Office: 434 Fisher Hall Phone: 614-292-3903 (office) E-mail: brewer.205@osu.edu (preferred method of contact) Office Hours: Tues. 1:45-3:15 pm; Weds. 3:45 – 5:15 pm / Mondays & Thursdays by appointment Course Materials: Required - Smith, Raabe, Maloney, 2011 ed. South-Western Federal Taxation: Taxation of Business Entities, ISBN 0-538-78621-3 Recommended - Smith, Raabe, Maloney, Study Guide, South-Western Federal Taxation 2011: Taxation of Business Entities, ISBN 0-538-47063-1 Course Description: This course covers the fundamentals of federal income tax and how it influences taxpayer decisions. Emphasis is on individuals and businesses organized as proprietorships, but the rules generally applicable to all taxpayers are covered. Prerequisite: AMIS 521 or equivalent. Course Objectives: This course is designed to acquaint the student with the workings and concepts of the federal tax law, especially as it pertains to individuals and business entities and to introduce the student to the workings of the U.S. tax system. Emphasis will be on learning the concepts underlying the tax law, using the current tax formula and its elements, applying tax law to decision models and incorporating tax planning principles into decision-making opportunities. Students are assumed......

Words: 1412 - Pages: 6

#### No Paper

...capital. • Key financial ratios. • Implications of the mix of debt and equity in a firm’s long-term financing (capital structure). Required Materials • Financial Management: Core Concepts (2/E) by Raymond Brooks. • MyFinanceLab (MFL) Access. • Purchase Options: Option 1: Bound Book Package includes the bound textbook and MFL Access. (ISBN: 0132925869). Option 2: “Student Value Edition”(SVE) Package includes a three-hole punch version of the textbook and MFL. This option cannot usually be returned, but it saves money up front (ISBN: 0132925893). Homework • Homework is an integral part of learning Finance and is the complete responsibility of the student. • The homework portion of the course average will consist of the equally-weighted average of the 10 highest (out of 12) assignment scores. • The policy for Finance 3101 is NOT to permit an extension of any homework assignment beyond the due date, subject to the following exceptions: (a) A medical condition or emergency; (b) A death in the family; or (c) A University-sponsored activity. In all cases, full WRITTEN documentation is required from the appropriate medical or Temple University personnel. • All “Past Due” assignments will receive a score of zero. • Students are responsible for using a computer that meets the system requirements for MFL homework (see “Browser......

Words: 1876 - Pages: 8

#### Math 540

...operations in various market environments. 2. Analyze financial statements for key ratios, cash flow positions, and taxation effects. 3. Review fixed income strategies using time value of money concept, bond valuation methods, and interest rate calculations. 4. Estimate the risk and return on financial investments. 5. Apply financial management options to corporate finance. 6. Determine the cost of capital and how to maximize returns. 7. Formulate cash flow analysis for capital projects including project risks and returns. 8. Evaluate how corporate valuation and forecasting affect financial management. 9. Analyze how capital structure decision-making practices impact financial management. 10. Design working capital management concepts to enhance tactical financial strategies. 11. Develop financial management strategies for global corporate environments. 12. Use technology and information resources to research issues in financial management. 13. Write clearly and concisely about financial management using proper writing mechanics. WEEKLY COURSE SCHEDULE The standard requirement for a 4.5 credit hour course is for students to spend 13.5 hours in weekly work. This includes preparation, activities, and evaluation regardless of delivery mode. Certain discussions are tied to scenarios. Please view these scenarios prior to participating in the related discussions. Week 1 Preparation  Reading(s) o Chapter 1: An Overview of Financial Management and the Financial Environment Scenario......

Words: 4119 - Pages: 17

#### Fin 534 Student Guide

...operations in various market environments.  2. Analyze financial statements for key ratios, cash flow positions, and taxation effects.  3. Review fixed income strategies using time value of money concept, bond valuation methods, and interest rate calculations.  4. Estimate the risk and return on financial investments.  5. Apply financial management options to corporate finance.  6. Determine the cost of capital and how to maximize returns.  7. Formulate cash flow analysis for capital projects, including project risks and returns.  8. Evaluate how corporate valuation and forecasting affect financial management. 9. Analyze how capital structure decision-making practices impact financial management.  10. Design working capital management concepts to enhance tactical financial strategies.  11. Develop financial management strategies for global corporate environments.  12. Use technology and information resources to research issues in financial management.  13. Write clearly and concisely about financial management using proper writing mechanics. WEEKLY COURSE SCHEDULE The standard requirement for a 4.5 credit hour course is for students to spend 13.5 hours in weekly work. This includes preparation, activities, and evaluation regardless of delivery mode. Week | Preparation, Activities, and Evaluation | Points | 1 | Preparation * Reading(s) * Chapter 1: An Overview of Financial Management and the Financial Environment......

Words: 1233 - Pages: 5

#### Into

...University of Puget Sound School of Business and Leadership BUS 435 International Finance Professor Alva Wright Butcher Tues & Thurs 12:30-13:50 McIntyre 107 Spring Semester 2013 Office: McIntyre 111 I Office Hours: Phone: 253-879-3349 Tues and Thurs 2:00-3:00 FAX: 253-879-3156 Wed 9:30-10:30 And by appointment Note that I am always willing to schedule additional office hours by appointment. I check email frequently, so that is also a good way to communicate. If I do not respond to your email message, that means I did not receive it. Please send it again. Email: butcher@ups.edu Required Course Materials Text: Madura, International Financial Management, Abridged 10th Edition, South-Western, 2011 Book: Lewis Michael, Boomerang: Travels in the New Third World, Norton, 2011 Calculator: A calculator is required. A financial calculator would be preferable, as it would have functions for bond valuation, net present valuation (NPV), internal rate of return (IRR), present value (PV), and future value (FV). A suitable calculator, the HP10-B, is available in the bookstore for about \$30. Harvard Business School Cases https://cb.hbsp.harvard.edu/cbmp/access/17920074 The above is the URL for Harvard Business School so that you can obtain discounted student pricing for the cases: Group Ariel S.S.: Parity Conditions and......

Words: 4483 - Pages: 18

Free Essay

#### Process Management

...of this course, we will focus on process design and improvement issues by studying the relationships between key process parameters such as capacity and throughput, and by analyzing processes in order to identify and eliminate bottlenecks. And, in the second part of the course, we will focus on process coordination issues by studying methods for the efficient planning and controlling of critical resources. Specific objectives are: To describe an operating system or a business process and how it can be used as a competitive weapon in a variety of manufacturing and service organizations. To understand decisions faced by operations managers, the skills required to make these decisions effectively, and how these decisions integrate with the overall strategy of the firm. To highlight many of the interfaces between the operations function and other functions of the firm such as finance, accounting, and marketing. To develop skills in analyzing operating processes, assessing economic trade-offs, and defining planning and control mechanisms. Design The approach to this course is both lecture and case analysis. We will develop concepts and tools in class, but the true test in learning a new concept or tool is whether or not it can be applied. Working in teams of 5, you will have the opportunity to hone skills and explore application possibilities through homework problem sets and case studies. The team aspect is important because group deliberation often opens......

Words: 2041 - Pages: 9

Free Essay

#### Egn Document

...3) Homework. Homework is worth 20% of grade. 1 Aug 29 Introduction 2 Sept 5 Codes of Ethics-ASCE and NSPE 3 Sept 12 Chapter 1-Making the Case –Topics for group papers due 4 Sept 19 NO CLASS (Watch Henry’s Daughters DVD) 5 Sept 26 Chapter 2-A Practical Ethics Toolkit-HW #1 group assignment-Henry’s Daughter’s due 6 Oct 3 Chapter 5-Trust and Reliability 7 Oct 10 Chapter 8-Engineers and the Environment 8 Oct 17 ASCE Webinar on Ethics-Dr. Stu Walesh 9 Oct 24 NO CLASS (Watch Incident at Morales DVD) 10 Oct 31 Aspirational Ethics/Engineering Body of Knowledge-Tomorrow’s Engineer- HW #2 group assignment-Incident at Morales due and typed draft of group paper 11 Nov 7 Guest Lecture-Mr. Ken Todd, P.E., Member of the Florida Board of Prof. Engineers 12 Nov 14 Class Presentations-In -class groups 13 Nov 21 Class Presentations-In-class groups and FEEDS 14 Nov 28 NO CLASS – Thanksgiving Recess 15 Dec 5 Class Presentations-FEEDS 16 Dec 13 FINAL EXAM (including all lectures, guest lecture and class presentations) 9:45-11:45 am Room to be assigned Requirements for group paper/presentations This deliverable must consist of a PowerPoint presentation and a hard copy of the report. The report must provide: (1) A detailed outline of the case being studied consisting of the main engineering, ethical and legal issues. (2) An analysis of the ethical dilemmas of the engineers involved. (3) Use information contained in the text in Chapter 2-A...

Words: 1333 - Pages: 6

#### Ksyllab

...Hewlett Packard 10B or a Texas Instruments BAII+ is ideal. Other brands/models may also suffice. Bring your calculator to class every day. Be sure you know how to use it. 5. Laptop computer – Many students find it useful to use their laptop computer during class. This is not required. Any student using a laptop during class is expected to stay fully focused on the subject at hand at all times – no e-mail, internet, etc. OPTIONAL TEXTBOOKS: 1. Financial Analysis with Microsoft Excel, Mayes and Shank, Thomson South-Western 2. Financial Management, Brigham and Ehrhardt, Thomson South-Western COURSE DESCRIPTION: This is a course in the theory and the practice of managerial finance. This is not a survey course, but an in‐depth look at the key principles that financial managers use to make decisions that create value for companies. Students are required to learn the theory that leads to sound financial decisions and are expected to apply the theory in various problems and examples to demonstrate sound financial decision‐making. This course emphasizes long‐term, strategic decisions such as major equipment purchases and capital structure decisions (issues of debt and equity). The principles of cost‐benefit analysis, value creation, risk and return, and time value of money we use in these contexts are also applicable to every day operational decisions. We study traditional types of projects and securities, but our analysis is also valid for unique investment......

Words: 2490 - Pages: 10

#### Capital Budgeting

...Excel which can be used as a calculator. Using a calculator or Excel, you should be able to compute the net present value (NPV) and the internal rate of return (IRR) on an uneven stream of cash flows. Packet: A packet of photocopied supplemental material is available at the bookstore. The packet includes teaching notes, cases, and practice tests. Additional Optional Material: Copies of the overheads are available on my web page and on blackboard. The solutions to all of the homework problems and hard copies of the overheads are available at the 5th floor copy center. A CD comes with the text book and includes Self Study Software, Corporate Finance Online Tutorials, and Narrated PowerPoint Slides. A Student Problem Manual (ISBN 0073282154) is available and the authors maintain a free Online Learning Center at www.mhhe.com/rwj. TAs and tutors: Mark Cherrington and Christian Hsieh will hold regular office hours for individual help and will hold help sessions that work through homework problems and old tests. Grading Grading for the course will be based on the following: |Class preparation (verbal and quizzes) 15% | |Two written cases on 10/2 & 12/8 30% | |Midterm on 10/20 20% | |Final exam (finals week) 12/15 to 12/19 35% | |Total 100% ...

Words: 2362 - Pages: 10

#### Bus 591expert Tutor/ Indigohelp

...Week 1 Homework Problems BUS 591 Week 2 DQ 1 Debits and Credits BUS 591 Week 2 DQ 2 Revenue & Expense BUS 591 Week 2 Homework Problems BUS 591 Week 3 DQ 1 Perpetual Inventory System BUS 591 Week 3 DQ 2 Inventory Valuation Methods BUS 591 Week 3 Homework Problems BUS 591 Week 4 DQ 1 Why do I need accounting BUS 591 Week 4 DQ 2 Sarbanes-Oxley Act of 2002 ............................................................................................................................ BUS 591 Week 1 DQ 2 Annual Reports For more classes visit www.indigohelp.com Annual Reports. Visit the website for Tootsie Roll (www.tootsie.com). Click on “Company Information” then “Financial Information”. Open the latest annual report and review it to find the answers to the following questions: § What are Tootsie Roll’s corporate principles? Do you agree with these principles, or do you feel there are additional principles that should be included? What was the total amount of Tootsie Roll’s assets for the most current year available? § What was the total amount of Tootsie Roll’s liabilities for the most current year available? § What is the amount of the difference between Tootsie Roll’s assets and liabilities? What is this difference called? .................................................................................................................................................. BUS 591 Week 2 Homework......

Words: 648 - Pages: 3