If a firm's sales are $1,680,000 and it costs 9 percent to carry current assets, what is the potential savings if management can increase inventory turnover from 2 to 4 times a year and increase receivables turnover from 5.0 to 6.5 times a year? Round your answer to the nearest dollar. $
Q: Brummitt Corp., is evaluating a new 4 - year project. The equipment necessary for the project will…
A: Step 1: The calculation of the after-salvage value AB1Equipment cost $ 2,950,000.00 2Sales value $…
Q: 1) ABC’s current stock price is $24.20 and had an PES OF $2.20. Calculate the ABC’s P/E multiple.…
A: 1) Calculating ABC's P/E multiple:The P/E (Price-to-Earnings) multiple is calculated as the stock…
Q: Find the equated date at which the original payments are equivalent to the single payment. State…
A:
Q: Tanaka Machine Shop is considering a four-year project to improve its production efficiency. Buying…
A: Break down of the calculation of the Net Present Value (NPV) for this project: 1. Initial Outlay:…
Q: How is value of cryptocurrency determined?
A: The following variables affect the value of cryptocurrencies, such as Ethereum and Bitcoin:Demand…
Q: f1
A: Step 1:(1) Calculate the amount of mortgage as follows.Mortgage Amount =Selling price − Down…
Q: Charlene is evaluating a capital budgeting project that should last for 4 years. The project…
A: Step 1: Calculate the depreciation expense for each year under the straight-line method:The…
Q: None
A: Part 2: Explanation:Step 1: Calculate the present value (PV) of cash flows if the hotel is developed…
Q: For a charity event, one minute of game time is added for every $2 donated. How many minutes of game…
A: The objective of the question is to find out how many minutes of game time would be added for a…
Q: Suppose that Sudbury Mechanical Drifters is proposing to invest $20.0 million in a new factory. It…
A: Step 1:(A) Step 2:(B) Final:
Q: None
A: Given information, Tax rate (t) = 40% or 0.40Before-tax cost of debt (rd) = 6% or 0.06Cost of…
Q: Tori just purchased some equipment that belongs in a 35% CCA class. The equipment cost $167,400.…
A: Given:Equipment cost (original UCC): $167,400CCA class: 35% (declining balance method)Year…
Q: Question 3 - (2 Consider a European call option on a non-dividend-paying stock where the stock price…
A: (b) Value of European Call Option (Non-Arbitrage Argument):Since we cannot short sell the stock in a…
Q: Data for September 16 Calls Puts 50,000 Australian dollar options (cents per unit) 64 Oct 0.48 65…
A: Here's a detailed calculation for better understanding. To give you an idea of how these prices…
Q: Pisa Pizza, a seller of frozen pizza, is considering introducing a healthier version of its pizza…
A: a.Soution. incremental sales associated with introducing the new pizza = New Pizza sale - lost sales…
Q: 2. O'Brien Inc. has the following data: IRE = 5.00%; RPM = 6.00%; and b = 1.25. What is the firm's…
A: Step 1: Find the formula for cost of equity When calculating cost of equity based on CAPM, we use…
Q: Consider the following information: State of Economy Probability of State of Economy Recession .15…
A: Part a: First we compute the expected return, that is given by: Expected return = Sum of…
Q: Question 2 ECM Manufacturing Company Limited has three (3) possible suppliers, all of which offer…
A: 1. Sources of Spontaneous Short-Term Financing: - Accounts Payable: This represents the amount owed…
Q: What is the difference between industrial projects and a film company? The main difference between…
A:
Q: 5. Merger analysis - Free cash flow to equity (FCFE) approach Consider the following acquisition…
A: In the context of merger analysis using the Free Cash Flow to Equity (FCFE) approach, the…
Q: ACME Mining is considering two capital projects. Project A (five-year horizon), considered to be…
A: Project A:Initial investment = $1,200,000Increase in Tax Shield: The capital asset depreciation…
Q: A piece of property is to be purchased at $305,000 for mining a precious metal. The annual net…
A: Cash Flow Diagram for Mining Investmenta. Cash Flow DiagramYear 0: -$305,000 (Initial Investment for…
Q: You have been asked by the president of your company to evaluate the proposed acquisition of a new…
A: SOLUTION:Year 0:The initial outlay for the project is $50,000. This includes the cost of the truck,…
Q: Raghubhai
A: Initial Revenue=20,000×€1,700=€34,000,000Initial Revenue in…
Q: a. The December 31, 2018 accounts receivable amounted to? b. The December 31, 2018 foreign currency…
A: The spot rate shows the cost of exchanging money at present. The strike price is the agreed-upon…
Q: QUESTION 15 Which comes closest to the price today of a U.S. Treasury bill that offers the amount of…
A: Step 1: Given Value for Calculation Future Value = fv = $10,000Time = t = 13 YearsWeekly Interest…
Q: Please show step by step how to solve. Given the following information, what is the monthly payment…
A: Given information: Present value of Loan amount (PV) = $200,000 Since loan payments are made monthly…
Q: Financial managers must be able to balance current assets and current liabilities to ensure the…
A: Question 1The operating cycle and cash cycle are two fundamental concepts in financial management…
Q: B C1 C2 A R1 12,8 6,13 R2 15, 13 9,6 3. In the normal form game above, using iterated elimination of…
A: In the provided game matrix, players A and B choose strategies R1 or R2 and C1 or C2 respectively.…
Q: None
A: 2.The flotation costs of the new bonds would be 4% of the proceeds.Let the amount raised be Y.Then,…
Q: Bhupatbhai
A: Step 1: To estimate Laputa Aviation's total value and the value of its equity, we'll follow these…
Q: What do you expect the inflation rate to be in Lukumenia, given nominal interest rates of 5 percent…
A: To calculate the expected inflation rate in Leukaemia, we can use the Fisher equation, which states…
Q: Hint(s) Check My Work (All answers were generated using 1,000 trials and native Excel…
A: It seems like there are some typos and errors in the text you provided. Let me help you correct and…
Q: Preferred stock is a hybrid security, because it has some characteristics typical of debt and others…
A: Step 1:Identify characteristics of preferred stock:Dividends are fixed: This characteristic is…
Q: Capital budgeting GAP, a retail chain, is considering buying a registered software from Microsoft so…
A: a) Unlevered Net Income and Free Cash Flows: Initial cost of software = $750,000Annual sales for the…
Q: Vijay
A: Part 2: ExplanationStep 1: Calculate the total revenue from the contractThe total units to be sold…
Q: An analyst has determined that the appropriate EV/EBITDA for Rainbow Company is 9.6. The analyst has…
A: The objective of the question is to calculate the value of equity for Rainbow Company using the…
Q: Q4. You are willing to buy a car which will cost you 20000 euros. A bank is willing to provides you…
A: 1. **Calculating Monthly Payments**: - For Option 1, it's an interest-only loan, meaning you only…
Q: None
A: To calculate the Free Cash Flows (FCF) for this project, we need to consider the initial investment,…
Q: Radhubhai
A: Determining Bid Price for Machine Screws ContractChallenge: Martin Enterprises desires 142,000…
Q: Question 21 of 30 View Policies Current Attempt in Progress Which of the following capital…
A: For firms to be able to make educated choices on long-term investments, capital budgeting strategies…
Q: 76°F Mostly cloudy 2 Current Attempt Pharoah Industries is expanding its product line and its…
A: NPV, or net present value, is how much an investment is worth throughout its lifetime, discounted to…
Q: F2
A:
Q: The table below contains data on Fincorp Incorporated. The balance sheet items correspond to values…
A: Answers: Operating Activities:Net Income (from the income statement) = $4,400Add back depreciation =…
Q: Schweser Satellites Inc. produces satellite earth stations that sell for $100,000 each. The firm's…
A: Dear student, below is the answer to your assignment: Part 2: Explanation:Step 1: Calculate the…
Q: Problem 3. (14 points) Consider the following rate and price tree for a straight bond. 981.65 9%…
A: The image you sent is a decision tree for a European put option on a straight bond. A straight bond…
Q: Problem 12-2 Spreadsheet Problem: PV of Depreciation Tax Benefits (LG12-4) Your company is…
A: Cost of new equipment = $ 855,000Depreciable life of equipment in years = 9Book value of new…
Q: (please correct answer and step by step solutions this question) The current price of a stock is…
A: Step 1: Calculate the Risk-Free Daily RateThe daily risk-free rate (r(daily)) is derived from the…
Q: Explain with each answer
A: Can be either higher or lower than the contract rent: This option is incorrect because the effective…
Q: Baghiben
A: Approach to solving the question: Detailed explanation: Examples: Key references:
If a firm's sales are $1,680,000 and it costs 9 percent to carry current assets, what is the potential savings if management can increase inventory turnover from 2 to 4 times a year and increase receivables turnover from 5.0 to 6.5 times a year? Round your answer to the nearest dollar.
$
Step by step
Solved in 2 steps
- Answer the following lettered questions on the basis of the information in this table: Amount of R&D, $ Millions Expected Rate of Return on R&D, % $ 10 16 20 14 30 12 40 10 50 8 60 6 Instructions: Enter your answer as a whole number. a. If the interest-rate cost of funds is 8 percent, what is this firm's optimal amount of R&D spending? million %24Time to grow: Zephyr Sales Company has currently reported sales of $1.125 million. If the company expects its sales to grow 6.5 percent annually, how long will it be before the company can double its sales? Use a financial calculator to solve this problem.Suppose Naboo Manufacturing's sales increase 20% over the next year. Assuming that all asset accounts change proportionately to sales, what is the external financing needed?
- A firm is considering a new inventory system that will cost $120,000. The system is expected to generate positive cash flows over the next four years in the amounts of $35,000 in year 1, $55,000 in year 2, $65,000 in year 3, and $40,000 in year 4. The firm’s required rate of return is 9%. What is the payback period of this project? 1.95 years 2.46 years 2.99 years 3.10 years Based on the information from Question 47. What is the net present value (NPV) of the project? $28,830.29 $30,929.26 $36,931.43 $39,905.28 Based on the information from Question 47, what is the internal rate of return (IRR) of this project? 14.03% 17.56% 19.26% 21.78% Based on the information from Question 47, what is the profitability index (PI) of this project? 0.87 1.11 1.31 1.83.Sunny Manufacturing is considering extending trade credit to some customers previously considered poor risks. Sales would increase by $220,000 if credit is extended to these new customers. Of the new accounts receivable generated, 10 percent will prove to be uncollectible. Additional collection costs will be 5 percent of sales, and production and selling costs will be 70 percent of sales. a. Compute the incremental income before taxes. $ Incremental income before taxes b. What will the firm's incremental return on sales be if these new credit customers are accepted? (Round the final answer to 2 decimal place.) Incremental return on sales % c. If the receivable turnover ratio is 4 to 1, and no other asset buildup is needed to serve the new customers, what will Sunny Manufacturing's incremental return on new average investment be? (Do round intermediate calculations. Round the final answer to the nearest whole percentage.) Incremental return on new average investment %Here are next year's projections for a firm you are valuing: Sales are expected to be $100 million. Gross margin is forecasted to be 50%. COGS and SG&A together are $90 million, of which depreciation is $10 million. Industrial customers (60% of sales) will take 100 days to pay their bills. Retail chains (40% of sales) make cash sales. The firm expects to turn over its inventory every 60 days. The firm will pay its bills in 20 days. Using the information provided above, What is next year’s inventory projected to be? [ Select ] What should be the average collection period (days) and next year’s accounts receivable? [ Select ]
- Carla Vista Sales Company has sales of $1,250,000. If the company’s management expects sales to grow 4.50 percent annually, how long will it be before sales double? Use financial calculator to solve this problem. (Round answer to 0 decimal places, e.g. 20.) Time needed to double its salesYour income is $80,000 a year. Bonds earn 6.5% interest. Converting from bonds to cash costs $25 per transaction. Given the assumptions of the inventory model, what is the optimum number of cash conversions per year? [Express your number rounded off to one decimal place.] 7. Extending from #6, what is your money demand? 8. Extending from #6, but where budget cuts have squashed your income down to $50,000 per year and the cost of bond conversion has risen to $50 per transaction. Now what is the optimal number of conversions per year? [Express your number rounded off to one decimal place.]We sometimes need to find how long it will take a sum of money (or anything else) to grow to some specified amount. For example, if a company's sales are growing at a rate of 20% per year, how long will it take sales to double?
- The sales director of ABC Corp suggest the following credit terms. He estimated the following:Sales will increase by at least 20%AR turnover will be reduced to 8 times from present turnover of 10 times.Bad debts will increase to 1.5%. Current bad debts are 1%.Current sales is P 900,000Variable cost ratio is 55%.Desired rate of return is 20%Fixed expenses is P 150,000What is the net advantage of changing the credit terms?Price Mart is considering outsourcing its billing operations. A consultant estimates that outsourcing should result in cash savings of $9,100 the first year, $15,100 for the next two years, and $18,100 for the next two years. Interest is at 10%. Assume cash flows occur at the end of the year. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: Calculate the total present value of the cash flows. (Do not round intermediate calculations. Round your final answer to nearest whole dollar.)(Efficiency analysis) ALei Industries has credit sales of $143 million a year ALef's management revwed ts anddei t is the maximum level of accounts receivable that ALei can carry and have a 45-day average colledtion period? Leis current accounts receivable collection period is 55 days, how much would it have lo reduce its level of accounts recelvable in oander to adi a. What is the maximum level of accounts receivable that ALei can carry and have a 45-day average collection period? b. The maximum level of accounts receivable vilbe smillion Round to one decimal place) The maximum level of accounts receivable will be S million.
