A firm with the following investment opportunities has a capital budget of $10,000. According to the net present value technique, which investment(s) should the firm make if the firm's cost of capital is 10%?? Investment A B C Cost $10,000 $7,000 $3,000 Cash inflow $12,000 $8,600 $4,000 ?
What will be an ideal response?
?The firm should select that combination of investments whichuses the available funds and maximizes the combined net present value.? NPVA = $12,000(PVIF 10% 1y) ? $10,000 = $12,000/(1 + .1) - 10,000 = $12,000(.909) ? $10,000 = $908? NPVB = $8,600/(1 + .1) ? $7,000 = $8,600(.909) ? $7,000 = $817? NPVC = $4,000/(1 + .1) - $3,000 = $4,000(.909) ? $3,000 = $636?NPVA is less than NPVB + NPVC. Therefore, select B + C over Aeven though A has the highest individual NPV.
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The standard cost of direct labor per unit is calculated by:
a) multiplying the standard quantity of direct labor by the standard price of direct labor. b) dividing the standard quantity of direct labor by the standard price of direct labor. c) adding the standard quantity of direct labor to the standard price of direct labor. d) multiplying the actual quantity of direct labor by the standard price of direct labor.
Which of the following actions do not cause an impropriety in job costing?
A. Charging costs to the wrong job. B. Choosing to use normal costing rather than actual costing. C. Choosing an allocation method based on the results rather than choosing the method based on resource usage. D. Misstating the stage of completion.
A bond has the following terms: principal amount $1,000 semi-annual interest $50 maturity 10 years ? a. What is the bond's price if comparable debt yields 12%? b. What would be the price if comparable debt yields 12% and the bond matures after five years? c. What are the current yields and yields to maturity in a. and b.? d. What would be the bond's price in a. and b. if interest rates declined to 8%? e. What are the current yields and yield to maturity in d.? f. What two generalizations may be drawn from the above price changes?
What will be an ideal response?
All database applications get and put database data by sending SQL statements to the DBMS
Indicate whether the statement is true or false