A firm has annual operating outlays of P1,800,000 and a cash conversion cycle of 60 days. If the firm currently pays 12 percent for negotiated financing and reduces its cash conversion cycle to 40 days, the annual savings is?
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A firm has annual operating outlays of P1,800,000 and a cash conversion cycle of 60 days. If the firm currently pays 12 percent for negotiated financing and reduces its cash conversion cycle to 40 days, the annual savings is?
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- Xader Manalastas predicts a cash requirement of P25,000 over a 1-month period in which cash is expected to be paid constantly. The opportunity interest rate is 12% per annum. The transaction cost associated with each borrowing or withdrawal is P10.a. What is the optimal transaction size? b. Since it is known how much is usually available to meet operating needs, What is the average cash balance?A firm is scheduled to receive payment of $32,000 in 2 years. What is the present value of this payment if r=4% compounded monthly?A company is considering an investment that will cost $759,000 and have a useful life of 6 years. The cash flows from the project are expected to be $450,000 per year in the first two years then $170,000 per year for the last 4 years. If the appropriate discount rate is 16.0 percent per annum, what is the NPV of this investment (to the nearest dollar)? Select one: O a. $316870 O b. $321617 O c. $1834870 O d. $439045
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- A firm is scheduled to receive payment of $32,000 in 2 years. What is the present value of this payment if r=4% compounded annually?If a project costs $100,000 and is expected to return $25,000 annually, how long does it take to recover the initial investment? What would be the discounted payback period at i=15%? Assume that the cash flows occur continuously throughout the year.A firm requires Rs. 20 million in cash for meeting its transaction needs over the next four months, its planning horizon for liquidity decisions. It currently has the amount in the form of marketable securities that earn 12 percent annual yield. The cash payments will be made evenly over the planning period. The conversion of marketable securities into cash entails a fixed cost of Rs. 900 per transaction. What is the optimal conversion size as per Baumol model?
- You invest $10,000 into a money market account that pays interest on a semi-annual basis (e.g., interest is compounded every six months). If the annual interest rate is R=0.08 (e.g., R=8%), how long will you have to wait for your initial investment to double to $20,000?Expected sales in the forthcoming year is $ 50,00. The firm plans to stick to the following policies towards the working capital; Debtors would be maintained at 30 days of sales, Creditors would be maintained at 30 days of cost of sales and Inventories would be maintained at 30 days of cost of sales. Assume that the firm wants to keep Working capital sufficient to finance Expected Credit Sales for the length of the Cash Cycle, how much working capital would the firm need? Consider 365 as the number of days in an year for you cycle calculations. (Select the option closest to the answer). 411 487 398 509 426 352A printing press machine has a cash equivalent of P250,000. For the first three years, it will provide P20,000 worth of profit each year. For the next four years, annual profit will be P35,000. For the last two years, expenses will exceed revenues and will have a loss of P10,000 each year. Calculate the acceptability of this investment using FW method if MARR is 18% per year. What is ERR if ϵ=15%?