Explanation textbox Finishing HurdleRate 16 OriginalCost ...

Question

Explanation textbox  Finishing HurdleRate  16  OriginalCost  $ (1,600,...

Accepted Answer

Payback Period Net Present Value Internal Rate of Return for Finishing Payback Period Year Cash Flows Cumulative net Cash flow 0 1600000 1600000 1 345000 1255000 2 495000 760000 3 365000 395000 4 275000 120000 5 329000 209000 6 429000 638000 7 329000 967000 8 279000 1246000 Payback Period Years before full recover Unrecovered cash inflow at start of the yearcash flow during the year 4 Year 120000 329000 4 Year 036 years 436 Years Net Present Value Year Annual Cash Inflow Present Value Factor at 16 Present Value of Annual Cash Inflow 1 345000 086207 29741379 2 495000 074316 36786564 3 365000 064066 23384005 4 275000 055229 15188005 5 329000 047611 15664118 6 429000 041044 17607973 7 329000 035383 11640992 8 279000 030503 8510210 TOTAL 158523246 Net Present Value NPV Present Value of annual cash inflows Initial Investment 158523246 1600000 1476754 Negative NPV Internal Rate of Return IRR Step 1 Firstly calculate NPV at a guessed discount Rate Say 15 Year Annual Cash Flow ....

Explanation textbox:


	Finishing
HurdleRate:	16%
OriginalCost:	$ (1,600,000)
Net CashInflows:
Year1	$ 345,000
Year2	495,000
Year3	365,000
Year4	275,000
Year5	329,000
Year6	429,000
Year7	329,000
Year8	279,000

Paybackperiod:

InternalRate of Return:

NetPresent Value:



Explanation textbox:

Explanation textbox: Finishing Hurdle Rate: 16% Original Cost: $ (1,600,000) Net Cash Inflows: Year 1 $ 345,000 Year 2 495,000 Year 3 365,000 Year 4 275,000 Year 5 329,000 Year 6 429,000 Year 7 329,000 Year 8 279,000 Payback period: Internal Rate of Return: Net Present Value: Explanation textbox:

80.2K

Verified Solution

Question

Accounting

Answer & Explanation Solved by verified expert

Get Answers to Unlimited Questions

Membership Benefits:

Other questions asked by students