Question

ABC Company sold the rights to use one of their patented processes that will result in them receiving cash payments of $10,000 at the end of every six months for each of the next five years and a lump sum payment of $20,000 at the end of the sixth year. Calculate the total present value of these payments assuming the interest rate is 10% compounded semi-annually. You will need to use the time value of money table factors posted in carmen to answer this question. To access these factors, click modules and then scroll to the time value of money topic. Click on the link labeled present & future value table factors. No credit will be awarded for this question using a means other than these table factors to answer this question.

Answer #1

3. ABC Company sold the rights to use one of their patented processes
that will result in them receiving cash payments of $10,000 at the
end of every six months for each of the next five years and a lump
sum payment of $20,000 at the end of the sixth year.
Calculate the total present value of these payments assuming the
interest rate is 10% compounded semi-annually.
You will need to use the time value of money table factors posted...

The following information is provided relating to a stream of
cash flows: Year Amount of cash flow 1-6 $20,000 per year (payments
at the end of the year) 7-11 $16,000 per year (payments at the end
of the year) Assume an interest rate of 6% compounded annually.
Calculate the present value of the stream of cash flows above. You
will need to use the time value of money table factors posted in
carmen to answer this question. To access these...

ABC Company wants to have $82,761 in nine years. The company intends to
accumulate that amount by making equal semi-annual cash deposits at the
beginning of every six months for nine years into a bank account that
pays 10% interest compounded semi-annually.
Calculate the amount of each semi-annual deposit.
Use the time value of money factors posted in carmen to answer this question.
To access these factors, click modules and then scroll to week 12. Click on
the link labeled...

Betty DeRose is going to deposit $20,000 into a savings account
at the beginning of every six months for the next eight years.
Assume the savings account will earn 12% interest compounded
semi-annually.
Calculate the amount of interest Betty DeRose will earn over
the eight year period.
You will need to use the time value of money table factors posted
in carmen to answer this question. To access these factors, click
modules and then scroll to the time value of...

XYZ Company is considering the purchase of a new piece of equipment and
has gathered the following information about the purchase:
Initial investment ................ ?
Annual cost savings ............... $20,000
Salvage value in 6 years .......... 30% of original cost of the equipment
Repair in 4 years ................. $21,000
Cost of capital ................... 10%
Life of project ................... 6 years
The net present value of this investment was calculated to be $22,924.
Calculate the salvage value for this piece of...

An asset is in the MACRS 5-year property class and is being
depreciated using the MACRS tables. The tax rate is 30%. The
depreciation deduction for this asset in year 2 totaled $12,800.
Calculate the depreciation deduction for this asset in year 4. You
will need to use the percentages from the MACRS tables posted in
carmen to answer this question. To access these percentages, click
modules and then scroll to weeks 13 & 14. Click on the link
labeled...

ABC Company is analyzing an investment project. The following
information is available concerning this project:
Initial investment ....................... $250,000
Working capital needed now ............... $ 31,000
Salvage value of equipment in 8 years .... $ 10,000
Annual net cash inflows .................. $120,000
Equipment repair in year 5 ............... $ 93,000
Life of project .......................... 8 years
Cost of capital .......................... 10%
Income tax rate .......................... 30%
Assume the working capital needed now will be released for
investment elsewhere at the...

ABC Company is analyzing an investment project. The following
information is available concerning this project:
Initial investment ....................... $250,000
Working capital needed now ............... $ 36,000
Salvage value of equipment in 8 years .... $ 10,000
Annual net cash inflows .................. $120,000
Equipment repair in year 5 ............... $ 33,000
Life of project .......................... 8 years
Cost of capital .......................... 10%
Income tax rate .......................... 30%
Assume the working capital needed now will be released for
investment elsewhere at the...

ABC Company is analyzing an investment project. The following
information is available concerning this project:
Initial investment ....................... $250,000
Working capital needed now ............... $ 92,000
Salvage value of equipment in 8 years .... $ 10,000
Annual net cash inflows .................. $120,000
Equipment repair in year 5 ............... $ 80,000
Life of project .......................... 8 years
Cost of capital .......................... 10%
Income tax rate .......................... 30%
Assume the working capital needed now will be released for
investment elsewhere at the...

QUESTION 1
All of the followings are the rights and privileges of a
Common Stockholders EXCEPTING:
a.
Voting/Proxy Rights
b.
Right to Dividends
c.
Residual Right
d.
Pre-emptive Right
e.
Right to Interest Payments
10 points
QUESTION 2
Your best friend's parents want to buy a home in the
Worcester County, but they don’t know the exact amount of money
that they can afford to borrow. They can afford monthly payments of
$ 1,800. A friendly bank in Worcester...

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