An increase in which one of the following is an indicator that an accounts receivable policy is becoming more restrictive?
Gateway Communications is considering a project with an init…
Gateway Communications is considering a project with an initial fixed assets cost of $1.74 million that will be depreciated straight-line to a zero book value over the 10-year life of the project. At the end of the project the equipment will be sold for an estimated $232,000. The project will not change sales but will reduce operating costs by $383,500 per year. The tax rate is 21 percent and the required return is 10.7 percent. The project will require $48,000 in net working capital, which will be recouped when the project ends. What is the project’s NPV?
A decrease in which one of the following will increase the a…
A decrease in which one of the following will increase the accounting break-even quantity? Assume straight-line depreciation is used and ignore taxes.
A stock had returns of 19.10 percent, 22.86 percent, −16.34…
A stock had returns of 19.10 percent, 22.86 percent, −16.34 percent, 9.50 percent, and 28.57 percent for the past five years. What is the standard deviation of the returns?
Which one of the following items is most likely a derived-de…
Which one of the following items is most likely a derived-demand inventory item?
Which one of the following time periods is associated with l…
Which one of the following time periods is associated with low rates of inflation?
Assume you graph a project’s net present value given various…
Assume you graph a project’s net present value given various sales quantities. Which one of the following statements is correct regarding the resulting function?
A new project has an initial cost of $255,000. The equipment…
A new project has an initial cost of $255,000. The equipment will be depreciated on a straight-line basis to a zero book value over the five-year life of the project. The projected net income each year is $13,300,$18,100, $20,360, $15,200, and $12,000, respectively. What is the average accounting return?
Rossdale Flowers has a new greenhouse project with an initia…
Rossdale Flowers has a new greenhouse project with an initial cost of $337,500 that is expected to generate cash flows of $47,300 for 10 years and a cash flow of $62,700 in Year 11. If the required return is 9 percent, what is the project’s NPV?
A new project has an initial cost of $175,000. The equipment…
A new project has an initial cost of $175,000. The equipment will be depreciated on a straight-line basis to a book value of $67,000 at the end of the four-year life of the project. The projected net income each year is $15,400,$18,150, $23,500, and $15,300, respectively. What is the average accounting return?