Answer:
Site B should be selected based on the IRR criterion
Explanation:
Please refer to the attached image for the entire question
The internal rate of return represents the discount rate which equates the after-tax cash flows generated by an investment to the initial amount put in.
When evaluating different projects, the one with the highest IRR should be the preferred option.
I hope my answer is beneficial to you
Answer:
c. $4,100 unfavorable
Explanation:
The calculation for sales price variance is detailed below:
= (Budgeted selling price - actual selling price) × actual quantity
= ($15.20 - $15.15) × 82,000 units
= 4,100 unfavorable
We simply apply the formula for sales price variance to arrive at the accurate figure
All other provided information was deemed irrelevant. Thus, it was disregarded
=
Answer:
You can accept a lump sum of at least $111,144.18 today.
Explanation:
To determine this amount, we need to evaluate the present value of the three cash inflows. This can be performed either manually or through an excel sheet utilizing the PV formula.
When calculated using an excel spreadsheet, the present value amounts to $111,144.18.
Thus, you could accept a lump sum of at least $111,144.18 today.
Manual calculation of this is also possible:
pv = [$36,000 / (1 + 7%)] + [$42,000 / (1 + 7%)²] + [$50,000 / (1 + 7%)³] = $111,114.18
