🏷️ LIMITED TIME OFFER: GET 20% OFF GRADE+ YEARLY SUBSCRIPTION →
Log in
HomeStudy Guides420,000CA160,000

FIN 300 Final: FIN300 cheatsheet

1227 views2 pages
School
Ryerson University
Department
Finance
Course
FIN 300
Professor
Patricia Mc Graw

For unlimited access to Study Guides, a Grade+ subscription is required.

Document Summary

Details regarding each project"s cash flows from the assets are shown in the table below. Project a has a required rate of return of 13%. Project b has a required rate of return of. A) 21. 55: you are the cfo of an ontario-based firm and are analyzing two mutually exclusive projects of similar size. Both projects have 5 year lives: project a project b npv ,090. ,693 payback 2. 76 years 2. 51 years average accounting return 9. 3 % You have been asked for your best recommendation given this information. The plant will be built on a piece of vacant land the company bought for million, 8 years ago. The company has not used the land in the past 8 years. The company will build its manufacturing plant on the vacant land. The plant will cost . 5 million to build. The site, the vacant land, requires . 5 million of grading before it is suitable for construction.

Get access

Grade+20% off
$8 USD/m$10 USD/m
Billed $96 USD annually
Grade+
Homework Help
Study Guides
Textbook Solutions
Class Notes
Textbook Notes
Booster Class
40 Verified Answers

Related Documents

FIN 300
Final Exam
Study Guide
FIN 300 Study Guide - Final Guide: Ryerson University, Cash Flow, Net Present Value
ochretoad724
FIN 300
Final Exam
Study Guide
FIN 300 Study Guide - Final Guide: Relative Risk, Accrued Interest, Retained Earnings
sapphiremouse631
FIN 300 Lecture Notes - Lecture 8: Managerial Finance, Net Present Value, Cash Flow
emeraldhedgehog234

Related Questions

Project A and B are mutually exclusive. The cash flows of the two projects are:

Project A: This project has an initial cost of $ 78000 and has annual cash flows for three years of $ 35,300, $ 31,500, and $ 35,000, respectively.

Project B: This project has an initial cost of $ 78000 and has annual cash flows for three years of $ 26,900, $ 30,500, and $ 44,900, respectively.

What is the crossover rate?

At the required return of 5 percent, which project should you accept? Why?

Accept project A and reject project B.

Reject both projects.

Accept both projects.

Accept project B and reject project A.

Accept either one of the projects, but not both.

Show your calculation

Two projects being considered are mutually exclusive and have the following projected cash flows: Project A Project B Year Cash Flow Cash Flow 0 -$50,000 -$50,000 1 $15,625 $65,341 2 $15,625 $8,392 3 $15,625 $7,321 4 $95,625 $678 If the required rate of return on these projects is 10 percent, which would be chosen and why?

Suppose your firm is considering two mutually exclusive, required projects with the cash flows shown below. The required rate of return on projects of both of their risk class is 10 percent, and that the maximum allowable payback and discounted payback statistic for the projects are 2 and 3 years, respectively. Time: 0 1 2 3 Project A Cash Flow -37,000 27,000 47,000 18,000 Project B Cash Flow -47,000 27,000 37,000 67,000 Use the PI decision rule to evaluate these projects; which one(s) should it be accepted or rejected?