Assume the following information for a capital budgeting proposal with a five-year time horizon:Initial investment:Cost of equipment (zero salvage value)Annual revenues and costs:Sales revenuesVariable expensesDepreciation expenseFixed out-of-pocket costsThis proposal's simple rate of return is closest to:$ 529,000$ 300,000$ 130,000$ 50,000$ 40,000Multiple Choiceо25%.15%.17%.19%.

Step 1: The calculation of the simple rate of return AB1Sales revenue $300,000.00 2Less: Variable…

Answered: Assume the following information for a…

Advanced Engineering Mathematics

10th Edition

ISBN:9780470458365

Author:Erwin Kreyszig

Publisher:Erwin Kreyszig

Chapter2: Second-order Linear Odes

Section: Chapter Questions

Problem 1RQ

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Consider the following financial information and answer the questionsthat follow:Sales : $250,000Costs : $134,000Depreciation : $10,200Operating expenses : $6,000Interest expenses : $20,700Taxes : $18,420Dividends : $10,600Addition to Retained Earnings : $50,080Long term debt repaid : $9,300New Equity issued : $8,470New fixed assets acquired : $15,000 You are required to:i) Calculate the operating cash flow ii) Calculate the cash flow to creditors iii) Calculate the cash flow to shareholders
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As part of the settlement for a class action lawsuit, Hoxworth Corporation must provide sufficient cash to make the following annual payments (in thousands of dollars): Year 1 2 3 4 5 6 Payment 190 215 240 285 315 460 The annual payments must be made at the beginning of each year. The judge will approve an amount that, along with earnings on its investment, will cover the annual payments. Investment of the funds will be limited to savings (at 4% annually) and government securities, at prices and rates currently quoted in The Wall Street Journal. Hoxworth wants to develop a plan for making the annual payments by investing in the following securities (par value=$1000) . Funds not invested in these securities will be placed in savings. Security Current Price Rate (%) Years to Maturity 1 $1055 6.750 3 2 $1000…
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