Fundamentals of Capital Budgeting: Replace Old Machine or Not

Fundamentals of Capital Budgeting: Replace Old Machine or Not

One year ago, your company purchased a machine used in manufacturing for $110,000. You have learned that a new machine is available that offers many advantages; you can purchase it for $150,000 today. It will be depreciated on a straight-line basis over 10 years, after which it has no salvage value. You expect that the new machine will produce EBITDA (Earnings Before interest, taxes, depreciation, and amortization) of $40,000 per year for the next 10 years. The current machine is expected to produce EBITDA of $20,000 per year. The current machine is being depreciated on a straight-line basis over a useful life of 11 years, after which it will have no salvage value, so depreciation expense for the current machine is $10,000 per year. All other expenses of the two machines are identical. The market value today of the current machine is $50,000. Your company’s tax rate is 45%, and the opportunity cost of capital for this type of equipment is 10%. Is it profitable to replace the year-old machine?

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Fundamentals of Capital Budgeting: Percolated Fiber Free Cash Flow

Fundamentals of Capital Budgeting: Percolated Fiber Free Cash Flow in $1.50 only (Instant Download)

You are a manager at Percolated Fiber, which is considering expanding its operations in synthetic fiber manufacturing. Your boss comes into your office, drops a consultant’s report on your desk, and complains, “We owe these consultants $1 million for this report, and I am not sure their analysis makes sense. Before we spend the $25 million on new equipment needed for this project, look it over and give me your opinion.” You open the report and find the following estimates (in millions of dollars):

All of the estimates in the report seem correct. You note that the consultants used straight-line depreciation for the new equipment that will be purchased today (year 0), which is what the accounting department recommended. The report concludes that because the project will increase earnings by $4.875 million per year for ten years, the project is worth $48.75 million. You think back to your halcyon days in finance class and realize there is more work to be done!

Financial Statement Comparison of PepsiCo and Coca-Cola

Financial Statement Comparison of PepsiCo and Coca-Cola in $21 Only (Instant Download)

Free Sample Answer Given Below

PepsiCo’s financial statements are presented in Appendix A. Financial statements of The Coca-Cola Company are presented in Appendix B.
This is from the appendixes in the 7th edition of financial accounting byWeygandt, kimmel, and kieso.

Instructions:

(a) Based on the information contained in these financial statements, determine each of the following for each company. Please show all numerical equations including numerator and denominator, not just a final number. Present your work in a comparative format using a table as illustrated:
1) Gross profit for 2008 PepsiCo Coca-Cola and Gross profit rate for 2008.

2) Percent change in operating income from 2007 to 2008.

3) Accounts receivable turnover for 2008.

4) Days sales in receivable for 2008.

5) Inventory turnover for 2008.

6) Days inventory on hand for 2008.

7) Increase (decrease) in cash and cash equivalents from 2007 to 2008.

8 ) Asset turnover ratio for 2008.

Car Buying Assignment

Front left of car

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Car Buying Assignment

In this assignment, we will learn how to buy a car and figure out whether it is priced at or below market value.

First, you need to decide on your budget which is the maximum you can spend on a car and that maximum number should take into consideration price, tax, registration, and fixing if needed.

Second, go to the web site: www.cars.com and search for a car in within your budget constraint.

Third, go to the web site: www.kbb.com (The Kelly Blue Book web site) and find out whether the car is at market value, overpriced, or under priced.

Finally, write a two page paper discussing your findings. Issues to explain or discuss:

• Why did you pick the car your picked?
• What are the 3 different prices that Kelly Blue Book provides?
• Based on Kelly Blue Book prices, is the car over or under priced?
• Any surprises, prior experience, feedback, thoughts…etc

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Summary of MediSys Corp.: The IntensCare Product Development Team Summary

Write a one page summary of  HBR Brief case study ‘MediSys Corp.: The IntensCare Product Development Team’.

Please, also include the key points of this case study.

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Mini Case: Will Leasing Fly at Continental?

Continental Airlines

CFM 3 Ch 21 Minicase Will Leasing Fly at Continental? in $28 only

  1. Calculate the net advantage to leasing, using the expected residual value and assuming Continental can use all the tax benefits of ownership with a tax rate of 40% and straight line depreciation to the expected residual value. Assume that Continental issues 80% secured debt and 20% unsecured debt to finance a purchase.

a) Calculate rt–the project cost of capital.

b) Calculate the expected lease residual value per aircraft.

c) Calculate the quarterly CFAT per aircraft under the leasing option.

      • Hint: It should be the same each quarter hroughout the term of the lease.
      • The lease payment is tax deductible.
      • Under the leasing option Continental forgoes the depreciation tax deduction.

      d) Calculate the NAL.

          • Assume quarterly compounding to match the lease payments.
          • Continental’s required return on the asset—r, is given.
          • Assume no incremental difference in operating expenses between the purchasing and leasing options.
          • Assume that the lessor claims the ITC.

          2.  Calculate the net advantage to leasing, assuming Continental cannot use any of the tax benefits of ownership and the residual value is (i) the expected residual value, (ii) $50 million, and (iii) $10 million

          Reeds Clothier Case Study and Questions

          Reeds Clothier Case Study and Questions

          Reeds Clothier Case Study and Questions

          WEEK 4 – FIN 370 

          “Reed’s Clothier” Case Study and Questions

          Prepare a 350-700-word case study analysis of Case #16: “Reed’s Clothier” located in the Cases in Financial Management text, by Sulock and Dunkelberg. Be sure to address the following in your analysis:

          Briefly summarize the case.

          1) Calculate a few ratios and compare Reed’s results with industry averages. (Some industry averages are shown in Exhibit 16.4) What do these ratios indicate?

          2. Why does Holmes want Reed’s to have an inventory reduction sale, and what does he think will be accomplished by it?

          3. Jim Reed had adopted a very loose working capital policy with higher current assets than industry averages. If he merely tightens his working capital policy to the averages, should this affect his sales?

          4. Assuming that Reed’s can improve its operations to be in line with the industry averages, construct a 1995 pro forma income statement. Assume that net sales will be reduced 5 percent to $1,938,000 but that depreciation and amortization will not change but remain at $32,000.

          5. What type of inventory control system would you suggest to Jim Reed?

          6. What type of accounts receivable control would you suggest to Jim Reed?

          7. Is the increase in sales related to the increase in inventory?

          8. What is Reed’s cost of not taking the suppliers’ discounts?

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          Yes, One More Time, We Did it…Our Domain Name

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          HCA417 Full Week 5

          HCA417 Full Week 5

          HCA 417 Full Week 5

          HCA/417 Full Week 5

          Following files are available with the answer:

          1. HCA 417 Week 5 Assignment Final Paper.docx
          2. HCA 417 Week 5 DQ1.docx
          3. HCA 417  Week 5 DQ2.docx

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          ACC 422 Week 5 WileyPlus Assignment – Exercises

          ACC 422 Week 5 WileyPlus Assignment – Exercises (Instant Download)

          E13-13 (Contingencies) Presented below are three independent situations. Answer the question at the end of each situation. 

          1. During 2010, Maverick Inc. became involved in a tax dispute with the IRS. Maverick’s attorneys have indicated that they believe it is probable that Maverick will lose this dispute. They also believe that Maverick will have to pay the IRS between $800,000 and $1,400,000. After the 2010 financial statements were issued, the case was settled with the IRS for $1,200,000. What amount, if any, should be reported as a liability for this contingency as of December 31, 2010?

          2. On October 1, 2010, Holmgren Chemical was identified as a potentially responsible party by the Environmental Protection Agency. Holmgren’s management along with its counsel have concluded that it is probable that Holmgren will be responsible for damages, and a reasonable estimate of these damages is $6,000,000. Holmgren’s insurance policy of $9,000,000 has a deductible clause of $500,000. How should Holmgren Chemical report this information in its financial statements at December 31, 2010?

          3. Shinobi Inc. had a manufacturing plant in Darfur, which was destroyed in the civil war. It is not certain who will compensate Shinobi for this destruction, but Shinobi has been assured by governmental officials that it will receive a definite amount for this plant. The amount of the  compensation will be less than the fair value of the plant, but more than its book value. How should the contingency be reported in the financial statements of Shinobi Inc.?

          P13-9 (Premium Entries and Financial Statement Presentation) Sycamore Candy Company offers a CD single as a premium for every five candy bar wrappers presented by customers together with $2.50. The candy bars are sold by the company to distributors for 30 cents each. The purchase price of each CD to the company is $2.25; in addition it costs 50 cents to mail each CD. The results of the premium plan for the years 2010 and 2011 are as follows. (All purchases and sales are for cash.)
          2010           2011
          CDs purchased                     250,000         330,000
          Candy bars sold                  2,895,400      2,743,600
          Wrappers redeemed         1,200,000         1,500,000
          2010 wrappers expected to be redeemed in 2011 290,000
          2011 wrappers expected to be redeemed in 2012 350,000

          HCA 417 Electronic Medical Records – Entire Course – Ashford University

          HCA 417 ELECTRONIC MEDICAL RECORDS – ENTIRE COURSE – ASHFORD UNIVERSITY

          HCA 417 Entire Class

          HCA 417 Full Course

          HCA/417 Entire Course

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          Full Course BCOM 275 Entire Course (DQs, IAs, and LTAs)

          Full Course BCOM 275 Entire Course (DQs, IAs, and LTAs) (Instant Download) Just $19

          Full Course BCOM/275

          Entire Course BCOM275 

          ANSWER AVAILABLE.

          Following files are available in entire course of BCOM 275:

          OI 361 Entire Week 5 All DQs, Individual Assignment, Learning Team Assignment and Summary

          OI 361 Entire Week 5

          OI 361 Entire Week 5 All DQs, Individual Assignment, Learning Team Assignment and Summary

          OI/361 Week 5 All Discussion Questions (DQs)

           

          Following files are available with answer:

          1.  OI361 Week 5 DQ1.docx
          2.  OI361 Week 5 DQ2.docx
          3. OI 361 Week 5 Individual Assignment Organizational Transformation Q&A.docx
          4. OI 361 Week 5 Learning Team Assignment Innovation Process Paper and Presentation.docx
          5. OI 361 Week 5 Learning Team Assignment Innovation Process Paper and Presentation.pptx
          6. OI 361 Week 5 Summary

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          BIS 375 Week 1 Individual Assignment E-Business Evolution Paper

          BIS 375 Week 1 Individual Assignment E-Business Evolution Paper

          Prepare a 700- to 1,050-word paper based on your research in which you cover the following points:

          • Briefly explain the evolution of e-business.
          • Compare and contrast the differences and limitations between e-business and e-commerce as they relate to supply chain management.
          • Cite at least two sources in addition to the textbooks to support your conclusions.

          Format your paper according to APA standards.


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          BIS 375 Week 2 Learning Team Assignment E-Commerce Web Site Analysis

          BIS 375 Week 2 Learning Team Assignment E-Commerce Web Site Analysis

          BIS 375 Week 2 Learning Team Assignment

          Prepare a 1,050- to 1,400-word paper analyzing these Web sites as they relate to supply chain management.

          Include a history of the organization or industry, the market in which it operates, the role of government regulations on it, and any issues or opportunities that it faces.
          Include at least these of the following items in your analysis, plus three additional items relevant to the industry chosen:

          • How user friendly is it?
          • Download speed
          • Navigability
          • Content quality
          • Aesthetics

          Format your paper according to APA standards.

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          BIS 375 Week 3 Learning Team Assignment Impact of E-Business on Supply Chain Management Paper and Presentation

          BIS 375 Week 3 Learning Team Assignment

          BIS 375 Week 3 Learning Team Assignment Impact of E-Business on Supply Chain Management Paper and Presentation

          Prepare a 700- to 1,050-word paper, using the industry previously selected by the team, which accomplishes the following:

          • Assesses the effect of e-business SCM initiatives on an organization in this industry
          • Compares and contrasts the demands and expectations of different types of customers of this industry
          • Compares and contrasts traditional and e-business procurement processes for this industry

          Format your paper according to APA standards.

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          BIS 375 Week 5 Individual Assignment Emerging Technology and Trends Paper

          BIS 375 Week 5 Individual Assignment Emerging Technology and Trends Paper

          Prepare a 700- to 1,050-word paper, using Week Five readings and additional research from the Internet, in which you evaluate the effect of emerging technology trends on e-business and SCM.

          Describe and provide examples from your readings and additional research of business opportunities based upon e-business and SCM principles.

          Cite at least two sources in addition to the textbooks to support your evaluation.

          Format your paper according to APA standards.

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