1. Choose True or False for each of the following statements: a) Sensitivity analysis is concerned with determining how much variation infinancial data, the decision maker can have to affect the economic decision. b) Useful life is a period of time that yields the minimum equivalent uniformannual cost of owning and operating as asset. c) Depreciation is a reduction in value of an asset, which reflects its actualusage during ownership. d) In an optimistic estimation of MARR, we expect to see a lower MARR thanthat of pessimistic. e) If one of extreme FW values, i.e., optimistic and pessimistic scenarios, ofan alternative is positive and another one is negative, a go-decision ismade without further analysis. f) Recovery period refers to the depreciable life of an asset. g) Spider plot is used to show the amount of changes on the value of morethan one factor at a time. h) The book value at the end of useful life might not be equal to the salvagevalue when declining balance with switchover…

As an accountant, your job is to maintain your clients' accounting ledgers. Total Revenues ($) Total Costs ($) Wages and Salaries Risk-free return of 5% on owner's capital of $950,000 Interest on bank loan 850,000 650,000 47,500 30,000 150,000 10,000 Cost of supplies Depreciation of capital equipment Additional wages the dentist owner could have earned in her next best alternative Risk premium of on the owner's capital of $950,000 One client has submitted the above information to you, but the last line of the table is missing. You know that the firm is currently earning economic profits equal to -$66,000. Your answers should include only numbers. Do not include the $ or the comma (,) in your answer. In total, the firm's explicit costs are equal to $ The missing number that should go in the right column of the last row of the table (below the zero) is $ The firm is currently earning accounting profit equal to $| . Include the negative sign if applicable.

Investment- -End of Chapter Problem Management at TJX Companies is deciding whether to build a new goods distribution center. The distribution center will cost $60 million to build; the estimated additional first year revenue will be $5 million. The distribution center will last 50 years, with a depreciation rate of 5% per year. The opportunity cost of this investment is predicted to be 7% interest earned. a. What is the present value of the stream of payments resulting from this potential new goods distribution center? Round to the nearest million. b. TJX million. build the distribution center because the

Investment - End of Chapter Problem Management at TJX Companies is deciding whether to build a new goods distribution center. The distribution center will cost $60 million to build; the estimated additional first year revenue will be $5 million. The distribution center will last 50 years, with a depreciation rate of 5% per year. The opportunity cost of this investment is predicted to be 7% interest earned. a. What is the present value of the stream of payments resulting from this potential new goods distribution center? Round to the nearest million. $ b. TJX million build the distribution center because the benefit exceeds the cost cost exceeds the benefit

Investment-End of Chapter Problem Management at TJX Companies is deciding whether to build a new goods distribution center. The distribution center will cost $60 million to build; the estimated additional first year revenue will be $5 million. The distribution center will last 50 years, with a depreciation rate of 5% per year. The opportunity cost of this investment is predicted to be 7% interest earned. a. What is the present value of the stream of payments resulting from this potential new goods distribution center? Round to the nearest million. $ b. TJX million build the distribution center because the

Joey is one of several winners who shared a lottery ticket. There are three plans offered to receive the after-tax proceeds. Plan 1: $100,000 now Plan 2: $15,000 per year for 8 years beginning 1 year from now. Total is $120,000. Plan 3: $45,000 now, another $45,000 four years from now, and a final $45,000 eight years from now. Total is $135,000. Joey, a quite conservative person financially, plans to invest all of the proceeds as he receives them. He expects to make a real return of 6% per year. Use the 8-year time frame and an average inflation of 4% per year to determine which plan provides the best deal.

Relevant details of an investment decision are given below. Initial Investment 10 lacs, Cost of capital 9%, Tax rate 20% From the above Calculate the Payback period, and NPV

TRUE OR FALSE. Depreciation of a property due to more efficient products being produced and made available in the market is called functional depreciation.

build a modelAn industrial park is being planned for a tract of land near a river. To prevent flood damage to the industrial buildings that will be built on this low-lying land, an earthen embankment can be constructed.        The height of the embankment will be determined by an economic analysis of the costs and benefits.The following data have been gathered (Tables 1 and 2).    The embankment is expected to last 40 years and will require no maintenance.Whenever the flood water flows over the embarkment, a $310,000 in annual damages occur.        The corporation uses an interest rate of 15%         a) if they build the embarkment, what height should it have?   Table 1     Table 2     Embankment Height Above Roadway (m) Initial Cost ($)   Embankment Height Above Roadway (m) Avg Frequency That Flood Level  Will Exceed heigh of embarkment   2.0  $ 100,000.00   2.0  Once in 3 years    2.5  $ 165,000.00   2.5  Once in 8 years    3.0  $ 300,000.00   3.0  Once in 25 years    3.5…