A project under consideration by Radisson Corporation would require a working capital investment of $200,000 . The working capital would be liquidated at the end of the project's 10-year life. If Radisson Corporation has an after-tax cost of capital of 10 percent and a marginal tax rate of 30 percent, what is the present value of the working capital cash flow expected to be received in year 10?
Present value tables or a financial calculator are required.
a. $36,868
b. $77,100
c. $53,970
d. $23,130
B
The return of capital is tax-free.
Use PV of $1 10 years, 10%; Constant = 0.3855
$200,000 * 0.3855 = $77,100
You might also like to view...
What kind of communicators can be seen as manipulative or trying to hide their true motivations?
A. neutral B. empathetic C. strategic D. control
Gideon Company uses the direct write-off method of accounting for uncollectible accounts. On May 3, the Gideon Company wrote off the $2,000 uncollectible account of its customer, A. Hopkins. The entry or entries Gideon makes to record the write off of the account on May 3 is:
A.
| Bad Debts Expense | 2,000 | |
| Accounts Receivable-A. Hopkins | 2,000 |
B.
| Accounts Receivable-A. Hopkins | 2,000 | |
| Cash | 2,000 |
C.
| Cash | 2,000 | |
| Accounts Receivable-A. Hopkins | 2,000 |
D.
| Allowance for Doubtful Accounts | 2,000 | |
| Accounts Receivable-A. Hopkins | 2,000 |
E.
| Accounts Receivable-A. Hopkins | 2,000 | |
| Bad Debts Expense | 2,000 |
Most organizations require application forms to be completed because they provide a fairly quick and systematic means of obtaining a variety of information about the applicant.
Answer the following statement true (T) or false (F)
The "necessaries" of minors are precisely defined by law
Indicate whether the statement is true or false