A capacity alternative has an initial cost of $50,000 and cash flow of $20,000 for each of the next four years. If the cost of capital is 5 percent, the net present value of this investment is:
A) greater than $80,000 but less than $130,000.
B) greater than $130,000.
C) less than $30,000.
D) impossible to calculate, because no interest rate is given.
E) impossible to calculate, because variable costs are not known.
C
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ABC Company issued additional shares of stock for cash. The effect of the transaction is
A) the earnings per share increased. B) the debt-to-equity ratio increased. C) the current ratio was increased. D) the return on total assets increased.
Data on Wentz Inc. for last year are shown below, along with the payables deferral period (PDP) for the firms against which it benchmarks. The firm's new CFO believes that the company could delay payments enough to increase its PDP to the benchmarks' average. If this were done, by how much would payables increase? Use a 365-day year. Do not round your intermediate calculations. Cost of goods sold =$77,000Payables =$5,000Payables Deferral Period (PDP) =23.70Benchmark Payables Deferral Period =30.000?
A. $1,036 B. $1,382 C. $1,342 D. $1,648 E. $1,329
An opportunity cost is a cash flow that could be realized from the best alternative use of an owned asset
Indicate whether the statement is true or false
If a person dies without a valid will, her property will be distributed according to state statute, even if that distribution is contrary to the decedent's clear intention
Indicate whether the statement is true or false