Q: Distinguish the nominal rate of return from the real rate of return.
A:
Q: How do the Internal-Rate-of-Return Criterion relate to the PW Analysis?
A: Capital budgeting: It is the process in which the business uses to determine which proposed fixed…
Q: Define actuarial rate of return
A: Definition: Actuarial rate of return is the expected value of losses of an insurance company that…
Q: Required: a. Determine the discounted rate of return.
A: Formula: Discount rate= Lower Rate +Lower NPV×Higher Rate-Lower RateLower NPV-Higher NPV
Q: i. The net present value ii. The internal rate of return commend the decision to be made
A: Since in the given case the IRR is higher in machine 1 so it is to be selected. Assumptions: We…
Q: Why is partitioning an internal rate of return important?
A: Introduction: There are two cash flow components which can form the portioning of internal rate of…
Q: How much is BBM investment
A: This is a partnership - admission of a partner question, where the new partner is admitted with…
Q: Define Net realizable value.
A: Net realizable value is the expected cash to be received against a given asset. Thus, Net…
Q: What is the internal rate of return?
A: Internal rate of return is the discount rate at which present value of cash inflows equals outflows…
Q: Simple Rate of Return
A: Simple rate of return = Net operating income * 100/ Cost of investment
Q: refinancing rate
A: The refinancing rate refers to the interest rate which is required to be paid by the banks when they…
Q: Expected rate of return.
A: Risk-free rate: This can be described as the rate of return of the asset which has zero risks.…
Q: The internal rate of return for Company A is close to
A: IRR is a discount rate that makes the net present value (NPV) of all cash flows equal to zero in a…
Q: find The internal rate of return (IRR) for this case in exceland equation.
A: Internal rate of return(IRR) is the rate at which the the initial cost of project is equal to…
Q: ffective rate?
A: The given problem can be solved using EFFECT function in excel. EFFECT function computes effective…
Q: What is Market Value Added (MVA)?
A: The market value added is the difference of the current value of the company and the equity capital…
Q: ear. Calculate the rate of return of the investment.
A: Rate of return is the internal rate of return earned. Rate of return = 20.00%
Q: What is the Internal-Rate-of-Return Criterion?
A: Internal rate of return (IRR): The internal rate of return (IRR) is a measure utilized in capital…
Q: difference between internal rate of return and net present value?
A: Difference between internal rate of return and net present value?
Q: Which different terms are used to refer to rate of return?
A: Rate of return is the return that is expected by the investors from the investment made. It is…
Q: What is net present value (NPV) profile?
A: Net present value profile is mainly the graphical representation of net present value of different…
Q: PROVIDE - PRESENT VALUE, FUTURE VALUE, AND internal rate of return (IRR)
A: Present and Future Value: The current value of a cash flow that is expected to occur at some time in…
Q: Define payback period.
A: Capital investment analysis: Capital investment analysis is the process of decision making, planning…
Q: Define Expected rate of return
A: Introduction: Usually return is a kind of profit that comes from your investment. Example, an amount…
Q: Describe the Internal-Rate-of-Return Criterion?
A: Internal rate of return (IRR) is defined as the rate of discount at which the NPV of human capital…
Q: / Risk and Return
A: There are 3 things given in the question and asked for an explanation of only 1. Risk and Return…
Q: Expected return
A: Expected Return is the amount of loss or profit an investor expects to receive on an investment. It…
Q: Define target payout ratio
A: SOLUTION:- A target payout ratio is a degree of the proportion of a company's profits it would want…
Q: calculate internal rate of return acounting rate of return pay back period
A: Data given: Cost of machine = RM 3,500,000 Useful life of machine = 5 years Residual value = RM…
Q: Explain expected rate of return
A: Return: Return is defined as the money attained or lost on an investment through certain time…
Q: Present the internal rate of return criterion and its strengths and weaknesses.
A: “Hi There, Thanks for posting the questions. As per our Q&A guidelines, must be answered only…
Q: Define yield.
A: Yield can be considered as a metric for cash flow for the investor on the amount with which a…
Q: Define transfer price
A:
Q: Explain normal rate of return.
A: Rate of return: Rate of return is the return on investment. it might be a loss or profit on an…
Q: return on investment
A: First option is wrong because return on investment will decrease if invested capital increases.…
Q: Pricing Strategy
A: Answer: Pricing strategy refers to the method by which companies use to fix the prices for their…
Q: Define solvency ratios.
A: Solvency: Solvency is the capability of a company to pay the long-term liabilities which are due.…
Q: Define Net profi t margin
A: Net Profit Margin is calculated by dividing Net Profit by Revenue. It is a financial ratio used to…
Q: Risk Ratios
A: Average collection period = 365 * ((Opening accounts receivable + Closing accounts…
Q: e incremental revenue
A: Incremental revenue is the additional profit that can be made from choosing an alternative course of…
Q: What is Modified Internal Rate of Return (MIRR) method?
A: Internal rate of return (IRR): The internal rate of return (IRR) is a measure utilized in capital…
Q: Price
A: Step 1 The value the customer sees is important because marketing experts can use the concept to…
Q: Find the internal rate of return
A: Internal Rate of Return is the rate at which Present value of cash inflow is equal to present value…
Q: Define financial flexibility.
A:
Q: One of the advantages of Internal Rate of Return is:
A: The correct answer is b. It gives the closet rate of return.
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- Monty Company manufactures automobile components for the worldwide market. The company has three large production facilities in Virginia, New Jersey, and California, which have been operating for many years. Brett Harker, vice president of production, believes it is time to upgrade operations by implementing computer-integrated manufacturing (CIM) at one of the plants. Brett has asked corporate controller Connie Carson to gather information about the costs and benefits of implementing CIM. Carson has gathered the following data: Initial equipment cost $ 7,400,000 Working capital required at start-up $ 600,000 Salvage value of existing equipment $ 107,400 Annual operating cost savings $ 1,202,880 Salvage value of new equipment at end of its useful life $ 286,400 Working capital released at end of its useful life 2$ 600,000 Useful life of equipment 10 years Monty Company uses a 12% discount rate.A process control manager is considering two robots to improve materials-handling capacity in the production of rigid shaft couplings that make dissimilar drive components. Robot X has a first cost of $74,000, an annual M&O cost of $31,000, and $35,000 salvage value, and it will improve revenues by $96,000 per year. Robot Y has a first cost of $146,000, an annual M&O cost of $28,000, and $47,000 salvage value, and it will increase revenues by $120,000 per year. The company's MARR is 10% per year, and it uses a 3-year study period for economic evaluations. Calculate the incremental ROR, and identify the robot the manager should select. The incremental ROR is %. The manager should select robot (Click to select) ♥In 1926 Branky scott and his wife GV started a small company in India that pioneered the use of plastics in the manufacturing of marine products. Branky Manufacturing has evolved to produce thousands of products under the Branky Trademark which are sold into the fishing, marine, outdoor, and firefighting industries worldwide. To manage production costs, Branky is considering implementing a JIT production system. The following are the estimated costs and benefits of JIT production:- Annual additional tooling costs would be $400,000- Annual inventory would decline by 80 percent from the current level of $4,000,000- Insurance, material handling, and set-up costs which currently total $1,200,000 annually, would decline by 25%- Rework would be reduced by 30 percent. Branky currently incurs $800,000 in annual rework costs.Improved product quality under JIT production would enable Branky to raise the price of its products by $8 per unit. Scotty sells 80,000 units per year.- Branky required…
- A process control manager is considering two robots to improve materials-handling capacity in the production of rigid shaft couplings that make dissimilar drive components. Robot X has a first cost of $92,000, an annual M&O cost of $31,000, and $40,000 salvage value, and it will improve revenues by $96,000 per year. Robot Y has a first cost of $146,000, an annual M&O cost of $28,000, and $47,000 salvage value, and it will increase revenues by $124,000 per year. The company's MARR is 37% per year, and it uses a 3-year study period for economic evaluations. Calculate the incremental ROR, and identify the robot the manager should select. The incremental ROR is %. The manager should select robot: (Click to select) (Click to select) YRico Company produces custom-made machine parts. Rico recently has implemented an activity-based management (ABM) system with the objective of reducing costs. Rico has begun analyzing each activity to determine ways to increase its efficiency. Setting up equipment was among the first group of activities to be carefully studied. The study revealed that setup hours was a good driver for the activity. During the last year, the company incurred fixed setup costs of $860,200 (salaries of 17 employees). The fixed costs provide a capacity of 39,100 hours (2,300 per employee at practical capacity). The setup activity was viewed as necessary, and the value- added standard was set at 2,300 hours. Actual setup hours used in the most recent period were 37,110. Required: 1. Calculate the volume and unused capacity variances for the setup activity. Enter all amounts as positive values. Volume Variance 22 Unused Capacity Variance $ Show Me How 2. Prepare a report that presents value-added, non varue…The process-control division expects to sell 1,250 process-control units this year. From the viewpoint of Sierra Inc. as a whole, should 1,250 Xcel-chips be transferred to the process-control division to replace circuit boards? Show your computations.
- A process control manager is considering two robots to improve materials handling capacity in the production of rigid shaft couplings that mate dissimilar drive components. Robot X has a first cost of $84,000, an annual M&O cost of $31,000, a $40,000 salvage value, and will improve revenues by $96,000 per year. Robot Y has a first cost of $146,000, an annual M&O cost of $28,000, a $47,000 salvage value, and will increase revenues by $119,000 per year. The company’s MARR is 15% per year and it uses a 3-year study period for economic evaluations. Which one should the manager select (a) on the basis of ROR values, and (b) on the basis of the incremental ROR value? (c) Which is the correct selection basis? Perform the analysis by hand or spreadsheet, as instructed.Brik, located in Port St. Lucie, Florida, produces two lines of electric toothbrushes: deluxe and standard. Because Brik can sell all the toothbrushes it can produce, the owners are expanding the plant. They are deciding which product line to emphasize. To make this decision, they assemble the following data: E (Click the icon to view the data.) After expansion, the factory will have a production capacity of 4,900 machine hours per month. The plant can manufacture either 62 standard electric toothbrushes or 24 deluxe electric toothbrushes per machine hour. Read the requirements. ..... Requirement 1. Identify the constraining factor for Brik. Brik's constraint is Requirement 2. Prepare a product mix analysis to show which product line to emphasize. Deluxe Standard Toothbrushes Toothbrushes Data table Contribution margin per Per Unit Deluxe Standard Decision: Toothbrush Toothbrush Sales price 2$ 82 $ 54 22 18 Variable costs Emphasize the Brik standard electric toothbrush $ 60 $ 36…Green Manufacturing is a traditional manufacturing company located in the midwestern United States. The company's operations manager is developing a strategy to become more CSR-oriented. In an effort to evaluate possible areas where CSR initiatives can be implemented, the manager has gathered the following data regarding three potential CSR activities: Initial Added Cost Variable Cost Variable Savings Recycle and reuse production materials $ 5,000 $0.10 per lb. of recycled material $0.15 per lb. of recycled material Add solar panels as a source of power 700,000 $ 1,000 per year $ 33,000 per year Replace assembly room light fixtures with natural light 120,000 $ 180 per month $ 220 per month The recycling activity would carry on indefinitely. The solar panels would have a useful life of 30 years. The replacement of assembly room light fixtures with natural light is assumed to have an 80-year effect. a. Identify which CSR activities Green Manufacturing should…
- Green Manufacturing is a traditional manufacturing company located in the midwestern United States. The company's operations manager is developing a strategy to become more CSR-oriented. In an effort to evaluate possible areas where CSR initiatives can be implemented, the manager has gathered the following data regarding three potential CSR activities: Initial Added Cost Variable Cost Variable Savings Recycle and reuse production materials $ 5,000 $0.10 per lb. of recycled material $0.15 per lb. of recycled material Add solar panels as a source of power 700,000 $ 1,000 per year $ 33,000 per year Replace assembly room light fixtures with natural light 120,000 $ 180 per month $ 220 per month The recycling activity would carry on indefinitely. The solar panels would have a useful life of 30 years. The replacement of assembly room light fixtures with natural light is assumed to have an 80-year effect. a. Identify which CSR activities Green Manufacturing should…Green Manufacturing is a traditional manufacturing company located in the midwestern United States. The company's operations manager is developing a strategy to become more CSR-oriented. In an effort to evaluate possible areas where CSR initiatives can be implemented, the manager has gathered the following data regarding three potential CSR activities: Initial Added Cost Variable Cost Variable Savings Recycle and reuse production materials $ 5,000 $0.10 per lb. of recycled material $0.15 per lb. of recycled material Add solar panels as a source of power 700,000 $ 1,000 per year $ 33,000 per year Replace assembly room light fixtures with natural light 120,000 $ 180 per month $ 220 per month The recycling activity would carry on indefinitely. The solar panels would have a useful life of 30 years. The replacement of assembly room light fixtures with natural light is assumed to have an 80-year effect. a. Identify which CSR activities Green Manufacturing should…Toledo Tool Company plans to introduce a new product. The company also considers adopting a new computer-assisted manufacturing system. The new product can be manufactured by either the new computer assisted system or its traditional labor-intensive production system. The company can achieve the same quality of the product regardless of which the production system employed. The estimated product costs by the two production systems are as follows: Traditional Labor-Intensive Production Systems New Computer-Assisted Manufacturing Systems Direct Material (per unit) $10.5 $8.4 Direct Labor (per unit) $14.0 $9.0 Variable overhead (per unit) $5.5 $3.4 Fixed overhead $2M $3.5M The marketing department recommends that the unit selling price of the new product be at $65, and the company expects the selling expenses for the new product to be $830,000 annually plus $4 for each unit sold. The company is currently subject to a 40% income tax rate.…