Practice 13 w answers

Practice 13 w answers - NOREEN MANAGERIAL ACCOUNTING FOR...

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NOREEN MANAGERIAL ACCOUNTING FOR MANAGERS 2E Practice– Chapter 13 1 . The following data pertain to an investment that is being considered by the management of Newman Company: Cost of the investment $55,000 Estimated salvage value $ 3,000 Annual cost savings $ 15,000 Life of the project 5 years Discount rate 10% (a) What is the net present value of the proposed investment? (b) Should the project be accepted? Why or why not? 2. Trent Company has gathered the following data on a proposed investment project: Cost of the investment $1,600,000 Estimated salvage value $0 Annual cost inflows $200,000 Life of the project 10 years Discount rate 10% Part (a) What is the payback period for the investment? Part (b) What is the simple rate of return on the investment?
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Marren Company has gathered the following data on a proposed investment project: Cost of the investment $1,130,000 Estimated salvage value $0 Annual cost inflows $ 200,000 Life of the project 10 years Discount rate 10% (a) What is the approximate internal rate of return for this investment? (b) What is the net present value
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This note was uploaded on 01/13/2012 for the course IS 3020 taught by Professor Staff during the Spring '08 term at Kennesaw.

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Practice 13 w answers - NOREEN MANAGERIAL ACCOUNTING FOR...

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