Question

Manheim Candles is considering a project with the following incremental cash flows. Assume a discount rate...

Manheim Candles is considering a project with the following incremental cash flows. Assume a discount rate of 10%.

            Year                           Cash Flow

  1. ($15,000)
  2. $10,000
  3. $20,000
  4. $30,000

            Calculate the discounted payback period of the project.

Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Cash Flow

Net Cash Flow

Discounted Cash Flow

Net Discounted Cash Flow

Year 0

$-15,000.00

$-15,000.00

$-15,000.00

$-15,000.00

Year 1

$10,000.00

$-5,000.00

$9,090.91

$-5,909.09

Year 2

$20,000.00

$15,000.00

$16,528.93

$10,619.83

Year 3

$30,000.00

$45,000.00

$22,539.44

$33,159.28

Pay back period = 1.250 year

Discounted pay back period = 1.358 year

Cash return rate = 91.15% per year

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
. Calculate the IRR and NPV for the following cash flows. Assume a 15% discount rate...
. Calculate the IRR and NPV for the following cash flows. Assume a 15% discount rate Year Project 1 Cash flow Project 2 Cash flow 0 -$20,000 -$20,000 1 1,000 12,000 2 3,000 15,000 3 4,000 3,000 4 12,000 4,000 5 15,000 1,000 9. If your tenant pays you rent of $24,000 a year for 10 years, what is the present value of the series of payments discounted at 10% annually? 10. You are going to invest $300,000 in a...
​(Discounted payback period​) Sheinhardt Wig Company is considering a project that has the following cash​ flows:...
​(Discounted payback period​) Sheinhardt Wig Company is considering a project that has the following cash​ flows: If the​ project's appropriate discount rate is 9 ​percent, what is the​ project's discounted payback​ period? The​ project's discounted payback period is nothing years. ​(Round to two decimal​ places.) YEAR   PROJECT CASH FLOW 0   -60,000 1   20,000 2   50,000 3   65,000 4   55,000 5   40,000
Gio's Restaurants is considering a project with the following expected cash? flows: Year Project Cash Flow?...
Gio's Restaurants is considering a project with the following expected cash? flows: Year Project Cash Flow? (millions) 0 ?$(210?) 1 100 2 72 3 100 4 90 If the? project's appropriate discount rate is 11percent, what is the? project's discounted payback? period? The? project's discounted payback period is ____ years? Round to 2 decimal places
You are considering a project with the following set of cash flows: Cash flow 0 -5,500...
You are considering a project with the following set of cash flows: Cash flow 0 -5,500 1 2,000 2 3,000 3 1,000 4 2,000 a. What is the payback period of this project? If the pre-specified cut off is 3 years, should this project be accepted? b. What is the discounted payback period of this project? If the pre-specified cut off is 3 years, should this project be accepted? The discount rate is 10%.
Calculate the NPV for a project with the following cash flows. The discount rate (weighted average...
Calculate the NPV for a project with the following cash flows. The discount rate (weighted average cost of capital) is 7% and the initial investment is $50,000.    Cash flow each year: Year 1: $10,000 Year 2:  $12,000     Year 3: $15,000 Year 4: $15,000   Year 5: $15,000    Answer: ___________________________ (12 pts)
Suppose your firm is considering investing in a project with the cash flows shown as follows,...
Suppose your firm is considering investing in a project with the cash flows shown as follows, that the required rate of return on projects of this risk class is 8 percent, and that the maximum allowable payback and discounted payback statistic for the project are three and three and a half years, respectively Time                                    0                     1             2                          3                4                                5 Cash Flow                        -100,000        30,000        45,000            55,000          30,000                    10,000 Calculate the payback and use the payback decision rule...
Sun King Computers is considering the following project. The projected net cash flows are: Initial Cost...
Sun King Computers is considering the following project. The projected net cash flows are: Initial Cost is $3.5 million; annual net cash flows are $815,000 per year for 7 years. What is the Discounted Payback Period if the appropriate discount rate is 7.5%?
Suppose your firm is considering investing in a project with the cash flows shown as follows,...
Suppose your firm is considering investing in a project with the cash flows shown as follows, that the required rate of return on projects of this risk class is 8 percent, and that the maximum allowable payback and discounted payback statistic for the project are three and three and a half years, respectively. . Time                          0                               1                                2                                         3                              4                                            5 Cash Flow             -100,000                   30,000                       45,000                                 55,000                     30,000                                  10,000 Use the IRR decision rule to evaluate this project; should it be...
Assume the following cash flows for Project A: Year 0 =$(10,000); Year 1 = $4,000; Year...
Assume the following cash flows for Project A: Year 0 =$(10,000); Year 1 = $4,000; Year 2 = $3,500; Year 3 = $1,500; Year 4 = $3,000; and Year 5 = $1,500. The company’s hurdle rate is 9.00%. For Project A, please calculate: 1) the discounted payback period; 2) the net present value; 3) the internal rate of return; and 4) the modified internal rate of return.
Sky Enterprises is considering an investment project with the following cash flows: Year                   Cash Flow 0      &nbs
Sky Enterprises is considering an investment project with the following cash flows: Year                   Cash Flow 0                      -$100,000 1                         30,000 2                         40,000 3                         60,000 4                         90,000 The company has a 7% cost of capital. What is the project’s discounted payback period? A. 2.76 years B. 1.86 years C. 1.86 years D. 1.67 years E. more than 3 years
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT