A firm with a 14% WACC is evaluating two projects for this year's capital budget. After-tax cash flows, including depreciation, are as follows: 0 1 2 3 4 5 Project M Project N -$12,000 $4,000 $4,000 $4,000 $4,000 $4,000 -$36,000 $11,200 $11,200 $11,200 $11,200 $11,200
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- A firm with a 13% WACC is evaluating two projects for this year's capital budget. After-tax cash flows, including depreciation, are as follows: 0 1 2 3 4 5 Project M -$18,000 $6,000 $6,000 $6,000 $6,000 $6,000 Project N -$54,000 $16,800 $16,800 $16,800 $16,800 $16,800 Calculate NPV for each project. Do not round intermediate calculations. Round your answers to the nearest cent. Project M: $ Project N: $ Calculate IRR for each project. Do not round intermediate calculations. Round your answers to two decimal places. Project M: % Project N: % Calculate MIRR for each project. Do not round intermediate calculations. Round your answers to two decimal places. Project M: % Project N: % Calculate payback for each project. Do not round intermediate calculations. Round your answers to two decimal places. Project M: years Project N: years Calculate discounted payback for each project. Do not…A firm with a 13% WACC is evaluating two projects for this year's capital budget. After-tax cash flows, including depreciation, are as follows: 0 1 2 3 4 5 Project M -$12,000 $4,000 $4,000 $4,000 $4,000 $4,000 Project N -$36,000 $11,200 $11,200 $11,200 $11,200 $11,200 Calculate NPV for each project. Do not round intermediate calculations. Round your answers to the nearest cent. Project M: $ Project N: $ Calculate IRR for each project. Do not round intermediate calculations. Round your answers to two decimal places. Project M: %Project N: % Calculate MIRR for each project. Do not round intermediate calculations. Round your answers to two decimal places. Project M: %Project N: % Calculate payback for each project. Do not round intermediate calculations. Round your answers to two decimal places. Project M: yearsProject N: years Calculate discounted payback for each project. Do not round…A firm with a 14% WACC is evaluating two projects for this year's capital budget. After-tax cash flows, including depreciation, are as follows: 0 1 2 3 4 5 Project M -$27,000 $9,000 $9,000 $9,000 $9,000 $9,000 Project N -$81,000 $25,200 $25,200 $25,200 $25,200 $25,200 Calculate NPV for each project. Do not round intermediate calculations. Round your answers to the nearest cent. Project M: $ Project N: $ Calculate IRR for each project. Do not round intermediate calculations. Round your answers to two decimal places. Project M: % Project N: % Calculate MIRR for each project. Do not round intermediate calculations. Round your answers to two decimal places. Project M: % Project N: % Calculate payback for each project. Do not round intermediate calculations. Round your answers to two decimal places. Project M: years Project N: years Calculate discounted payback for each project. Do not round intermediate calculations. Round…
- A firm with a 14% WACC is evaluating two projects for this year's capital budget. After-tax cash flows, including depreciation, are as follows: Project M Project N -Select- 0 2 + -$18,000 $6,000 $6,000 $6,000 $6,000 $6,000 -$54,000 $16,800 $16,800 $16,800 $16,800 $16,800 a. Calculate NPV for each project. Do not round Intermediate calculations. Round your answers to the nearest cent. Project M: $ Project N: $ Calculate IRR for each project. Do not round Intermediate calculations. Round your answers to two decimal places. Project M: Project N: Calculate MIRR for each project. Do not round Intermediate calculations. Round your answers to two decimal places. Project M: Project N Calculate payback for each project. Do not round Intermediate calculations. Round your answers to two decimal places. Project M: Project N years Calculate discounted payback for each project. Do not round Intermediate calculations. Round your answers to two decimal places. Project M: -Select- % Select % % % years…A firm with a 13% WACC is evaluating two projects for this year's capital budget. After-tax cash flows, including depreciation, are as follows: 0 1 + 2 + -Select- % Project M -$6,000 $2,000 $2,000 $2,000 $2,000 $2,000 Project N -$18,000 $5,600 $5,600 $5,600 $5,600 $5,600 a. Calculate NPV for each project. Do not round intermediate calculations. Round your answers to the nearest cent. Project M: $ Project N: $ Calculate IRR for each project. Do not round intermediate calculations. Round your answers to two decimal places. Project M: Project N: Calculate MIRR for each project. Do not round intermediate calculations. Round your answers to two decimal places. Project M: Project N: Calculate payback for each project. Do not round intermediate calculations. Round your answers to two decimal places. Project M: Project N: years Calculate discounted payback for each project. Do not round intermediate calculations. Round your answers to two decimal places. Project M: Project N: years b. Assuming…A firm with a 14% WACC is evaluating two projects for this year’s capital budget. After-tax cash flows, including depreciation, are as follows: Project A, IRR = 19.86% and Project B, IRR = 16.80% Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Project A -$6,000 $2,000 $2,000 $2,000 $2,000 $2,000 Project B -$18,000 $5,600 $5,600 $5,600 $5,600 $5,600 a) Calculate NPV, payback, and discounted payback for each project. b) Assuming the projects are independent, which one(s) would you recommend? c) If the projects are mutually exclusive, which would you recommend?
- A firm with a 14% WACC is evaluating two projects for this year’s capital budget. After-tax cash flows, including depreciation, are as follows: Project A, IRR = 19.86% and Project B, IRR = 16.80% Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Project A -$6,000 $2,000 $2,000 $2,000 $2,000 $2,000 Project B -$18,000 $5,600 $5,600 $5,600 $5,600 $5,600 a) Calculate NPV, payback, and discounted payback for each project. b) Assuming the projects are independent, which one(s) would you recommend? c) If the projects are mutually exclusive, which would you recommend? d) Notice that the projects have the same cash flow timing pattern. Why is there a conflict between NPV and IRR?A firm with a 13% WACC is evaluating two projects for this year's capital budget. After-tax cash flows, including yearly depreciation, are as follows: Project M -$6,000 $2,000 $2,000 $2,000 $2,000 $2,000 Project N -$18,000 $5,600 $5,600 $5,600 $5,600 $5,600 Calculate discounted payback for each project. Do not round intermediate calculations. Round your answers to two decimal places. Project M: years Project N: yearsA firm with a 14% WACC is evaluating two projects for this year’s capital budget. After-tax cash flows, including depreciation, are below. Calculate the NPV for each and determine which project the firm should pick. Time Project A Project B 0 -$30,000 -$90,000 1 $10,000 $28,000 2 $10,000 $28,000 3 $10,000 $28,000 4 $10,000 $28,000 5 $10,000 $28,000
- A firm with a 13.5 percent cost of capital is considering a project for this year's capital budget. The project's expected after- tax cash flows are as follows: Year: 1 3 4 Cash flow: -$13,000 $6,400 $4,600 $6,200 $5,900 Calculate the project's net present value (NPV). O a. $7,352.42 b. $4,005.18 Ос. $10,100.00 d. $919.66 e. $3,528.79Marbry Corporation has provided the following information concerning a capital budgeting project: After-tax discount rate 9% Tax rate 30% Expected life of the project 4 Investment required in equipment $ 180,000 Salvage value of equipment $ 0 Annual sales $ 510,000 Annual cash operating expenses $ 370,000 One-time renovation expense in year 3 $ 70,000 The company uses straight-line depreciation on all equipment. Assume cash flows occur at the end of the year except for the initial investments. The company takes income taxes into account in its capital budgeting. The income tax expense in year 2 is:A company anticipates a taxable cash expense of $80,000 in year 2 of a project. The company's tax rate is 30% and its discount rate is 10%. The present value of this future cash flow is closest to: Select one: a. $(56,000) b. $(19,835) c. $(46,281) d. $(24,000)