# Finance

Aunt Sally's Food Inc. is considering expansion. Sally has paid \$100,000 for a marketing study to assist in the potential valuation. The study indicates that the new product will have sales of \$1,500,000 per year each year for the next 6 years. However, existing product line sales will be adversely affected by about \$200,000 per year. Equipment will cost \$1,100,000 and will be depreciated on the straight-line method with no salvage value at the end of 6 years. Annual fixed costs are \$160,000 per year and variable costs are 60% of annual sales. Also, initial working capital outlay of \$150,000 will be required which will be recaptured at the end of the 6 years. Sally's tax rate is 35%. The firm requires an 18% return. Sally also requires a 25% after tax return on an accounting basis.

I NEED TO FIND 1)NET PRESENT VALUE, 2) INTERNAL RATE OF RETURN AND 3) AVERAGE ACCOUNTING RETURN

1. 👍
2. 👎
3. 👁

## Similar Questions

1. ### PHYSICS

Sally Sue, an enthusiastic physics student enjoyed the opportunity to collect data from standing waves in a spring. She and her partner help the ends of their spring 4.00 meters apart. There are 5 nodes in the standing wave

2. ### Algebra 2

Rick deposits \$1,000 into an investment account which earns 4% annually. Sally loans \$1,000 to a friend, and the friend agrees to pay her \$50 each year, and will return the \$1,000 after 10 years. Determine the amount of money each

3. ### physics

Sally and a partner holds the ends of a spring 4 meters apart. There are 5 nodes in the standing wave produced. Sally moves her hand from the rest position back and forth along the floor 20 times in 4 seconds. Determine the

Aunt Sally’s “New Orleans Most Famous Pralines” sells pralines costing \$1.10 each to make. If Aunt Sally’s wants a 35% markup based on selling price and produces 45 pralines with an anticipated 15% spoilage, what should

1. ### Physics

Sally has a mass of 50.0kg and earth has a mass of 5.98X10^24kg. The radius of earth is 6.371x10^6m. A)What is the force of gravitational attraction between sally and earth? B)What is Sally's weight?

As Alex sat down in the carnival tent, the lights dimmed. A spotlight revealed a short, heavy man holding a thick chain. He tugged the chain, and an old, muzzled bear appeared. The man, the animal's owner, announced that the

3. ### Markups and markdowns

Sally buys a hand bag. There is a discount of 30%. IF Sally paid \$20, what was the original price?

4. ### math

The given box plots show the number of text messages Paul and Sally received each day on their cell phones. Select the true statement. A. The interquartile range of Paul's data is less than the interquartile range of Sally's data.

1. ### Math

Suppose that it takes Sally 3 hours to mow, and it takes Tom 4 hours to mow the same lawn; Tom's mower is less powerful than Sally's. Without using algebra determine how long it would take Sally and Tom to mow the lawn if they

2. ### math

sally and susan had an equal amount of oney each. after sally spent \$15 and susan spent \$24, the ratio of sally's money to susan's money was 4:3. how much money did each girl have at first?

3. ### Math

Sally's age is 12 years plus half her age. How old is she? Billy is twice as ld as Sally was when billy was as old as Sally is now. And the total ages is 28 how old are they?

4. ### Math

Compared to Jenny,Sally is 7/8 as tall and May is 6/7 as tall. How many times taller is Sally than May?