Answer:
The company will invest now and not delay
Explanation:
In order to determine the better option, we have to determine the Net present value of each of the option.
Net present value is the present value of after-tax cash flows from an investment less the amount invested.
NPV can be calculated using a financial calculator
The option with the higher NPV would be chosen
First option
Cash flow in year 0 = $-4.24 million
Cash flow in year 1 = $2.12 million
Cash flow in year 2 = $2.12 million
Cash flow in year 3 = $2.12 million
Cash flow in year 4 = $2.12 million
I = 8%
NPV = 2.78 million
Second option
NPV of the cash flow with $2.306 million a year for four years
Cash flow in year 0 = 0
Cash flow in year 1 = 0
Cash flow in year 2 = $-4.59 million.
Cash flow in year 3 = $2.306
Cash flow in year 4 = $2.306 million
Cash flow in year 5 = $2.306 million
Cash flow in year 6 = $2.306 million
I = 8
NPV = $2.61 million
NPV when cash flows would be $0.705 million
Cash flow in year 0 = 0
Cash flow in year 1 = 0
Cash flow in year 2 = $-4.59 million.
Cash flow in year 3 = $0.705 million
Cash flow in year 4 = $0.705 million
Cash flow in year 5 = $0.705 million
Cash flow in year 6 = $0.705 million
I = 8 %
NPV = -1.93 million
NPV of the second option = (0.85 x $2.61 million) + (0.15 x 0) = $2.22 million
The NPV when cash flows would be $0.705 million is zero because the NPV is negative and thus would not be undertaken.
The company will invest now and not delay because the NPV of not waiting is greater than the NPV of delaying
To find the NPV using a financial calculator:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. after inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.
3. Press compute
Lens Junction sells lenses for $44 each and is estimating sales of 16,000 units in January and 17,000 in February. Each lens consists of 2 pounds of silicon costing $2.50 per pound, 3 oz of solution costing $3 per ounce, and 15 minutes of direct labor at a labor rate of $18 per hour. Desired inventory levels are: Jan. 31 Feb. 28 Mar. 31 Beginning inventory Finished goods 4,300 4,800 4,900 Direct materials: silicon 8,300 9,200 9,000 Direct materials: solution 11,000 12,200 12,900
Complete Question:
1. Prepare a sales budget. Lens Junction Sales Budget For the Two Months Ending February 28, 20XX January February Expected Sales (Units) Sales Price per Unit Total Sales Revenue Total
2. Prepare a production budget. Lens Junction Production Budget For the Two Months Ending February 28, 20XX January February Expected Sales Total Required Units Required Production Total
3. Prepare direct materials budget for silicon. Lens Junction For the Two Months Ending Fabrant Materials, Purinat for Silinn February Expected Sales Total Required Units Required Production Total
4.Prepare direct materials budget for silicon.
Answer:
Lens Junction
1. Lens Junction Sales Budget For the Two Months Ending February 28, 20XX
January February
Expected Sales (Units) 16,000 17,000
Sales Price per Unit $44 $44
Total Sales Revenue $704,000 $748,000
2. Lens Junction Production Budget For the Two Months Ending February 28, 20XX
January February
Expected Sales Total 16,000 17,000
Ending Inventory 4,800 4,900
Required Units 20,800 21,900
Beginning Inventory 4,300 4,800
Required Production Total 16,500 17,100
3 & 4. Lens Junction Direct Materials Budget For the Two Months Ending February
January February
Silicon Solution Silicon Solution
Expected Sales 32,000 48,000 34,000 51,000
Ending inventory 9,200 9,000 12,200 12,900
Total Required 41,200 57,000 46,200 63,900
Beginning inventory 8,300 11,000 9,200 12,200
Units Required 32,900 46,000 37,000 51,700
Explanation:
a) Data and Calculations:
Sales price of lenses per unit = $44
Estimated sales of lenses in January and February respectively = 16,000 and 17,000
Direct materials for each lense:
2 pounds of silicon at $2.50 per pound = $5.00
3 oz of solution at $3.00 per ounce = $9.00
Total cost of direct materials per unit = $14
15 minutes direct labor at $18 per hour = $4.50
Desired inventory levels:
Beginning inventory of finished goods:
January 4,300
February 4,800
March 4,900
Beginning inventory of direct materials:
Silicon Solution
January 8,300 11,000
February 9,200 12,200
March 9,000 12,900
What to do most careers in Finance deal with?
a) real estate and education
b) assets and liabilities
c) assets and retail
d) real estate and retail
Answer:
b
Explanation:
B)
Answer: B would be the answer
Explanation: assist and liabilities
A Quality Analyst wants to construct a sample mean chart for controlling a packaging process. He knows from past experience that whenever this process is under control, package weight is normally distributed with a mean of twenty ounces and a standard deviation of two ounces. Each day last week, he randomly selected four packages and weighed each:
Day Weight (ounces)
Monday 23 22 23 24
Tuesday 23 21 19 21
Wednesday 20 19 20 21
Thursday 18 19 20 19
Friday 18 20 22 20
What are the upper and lower control limits for these data?
a. UCL = 22.644 LCL = 18.556
b. UCL = 22.700 LCL = 18.500
c. UCL = 22.755 LCL = 18.642
d. UCL = 21.814 LCL = 19.300
Answer:
a. UCL = 22.664 LCL = 18.556
Explanation:
The sample mean for the given data is :
( 23 + 20 + 19 + 20 + 21 ) / 5 = 20.6
Upper control limit is :
Sample mean + standard deviation
20.6 + 2 = 22.6
Lower Control Limit is :
Sample mean - Standard Deviation
20.6 - 2 = 18.6
Straight-Line Depreciation A building acquired at the beginning of the year at a cost of $2,200,000 has an estimated residual value of $400,000 and an estimated useful life of 20 years. Determine the following: (a) The depreciable cost $fill in the blank 1 (b) The straight-line rate fill in the blank 2 % (c) The annual straight-line depreciation $fill in the blank 3
Answer:
a)
Depreciable Cost = $ 1800000
b)
Straight Line Depreciation Rate = 5%
c)
Depreciation expense per year = $90000
Explanation:
a)
The depreciable cost is the cost that qualifies for depreciation. It is calculated as,
Depreciable Cost = Cost - Salvage Value
Depreciable Cost = 2200000 - 400000
Depreciable Cost = $ 1800000
b)
The straight line depreciation method charges a constant depreciation expense every period. The rate of straight line depreciation can be calculated as follows,
Straight Line Depreciation Rate = Depreciable cost percentage / Estimated useful life
Straight Line Depreciation Rate = 100% / 20
Straight Line Depreciation Rate = 5%
c)
The annual straight line depreciation expense can be calculated as follows,
Depreciation expense per year = Depreciable cost * Straight line depreciation rate
Depreciation expense per year = 1800000 * 0.05
Depreciation expense per year = $90000
How are a startup's financing requirements estimated
Answer:
How are Startups Financing Requirements Estimated?
1. Make Use of a Startup Work Sheet to be Able to Plan the Initial Financing.
2. Focus on the Expenses versus Assets. Another way for startups to estimate their financing requirements is by means of focusing on the expenses versus assets.
3. Similar Articles.
4. Cash Balance Prior to the Starting Date.
Explanation:
Q 9.20: City Mission is a not-for-profit organization that provides hot meals, living quarters, and showers for homeless people. Based on their yearly budget, they expect to spend $450,000 on food expenses, $350,000 on housing expenses, $280,000 on staff salaries, $90,000 on utilities, and $118,000 on other expenses. How much will City Mission need to raise in donations
Answer:
at least $1,288,000 in donation
Explanation:
With regards to the above information, we would add up all the expenses to arrive at how much donation that need City Mission needs to raise.
= Expenses on food + Housing expenses + Staff salaries + Utilities + Other expenses
= $450,000 + $350,000 + $280,000 + $90,000 + $118,000
= $1,288,000
The above is a large sum of money to raise only from donations, and by right a level or various levels of government should help pay for these expenses as no one go homeless either that or provide low cost homes for the homeless.