Questions from Financial Management

Q: Note the following information on two mutually exclusive projects under consideration by

Note the following information on two mutually exclusive projects under consideration by Wang Food Markets, Inc. Wang requires a 14 percent rate of return on projects of this nature. a. Compute the...

Q: Channel Tunnel Inc. plans to build an additional 23-mile

Channel Tunnel Inc. plans to build an additional 23-mile-long tunnel under the English Channel for added train service. The cost (NINV) of the tunnel is expected to be $3.3 billion. Net cash inflows a...

Q: Commercial Hydronics is considering replacing one of its larger control devices.

Commercial Hydronics is considering replacing one of its larger control devices. A new unit sells for $29,000 (delivered). An additional $3,000 will be needed to install the device. The new device has...

Q: Seco Dame Enterprises (SDE) acquired a robotic saw six years

Seco Dame Enterprises (SDE) acquired a robotic saw six years ago at a cost of $10 million. The saw was depreciated to its current book value of $0. Actual salvage value today is estimated to be $2 mil...

Q: Project Alpha requires an outlay of $10,000 immediately.

Project Alpha requires an outlay of $10,000 immediately. Project Alpha has a 1-year life and is expected to produce a net cash flow at the end of one year of $20,000. Project Beta, a mutually exclusiv...

Q: International Foods Corporation, a U.S.-based food company

International Foods Corporation, a U.S.-based food company, is considering expanding its soup-processing operations in Switzerland. The company plans a net investment of $8 million in the project. The...

Q: You have just been named the chief financial officer of Fabco,

You have just been named the chief financial officer of Fabco, a large metal fabricator located in Chama, New Mexico. The company has long been a user of the net present value method for evaluating it...

Q: The Taylor Mountain Uranium Company currently has annual revenues of $1

The Taylor Mountain Uranium Company currently has annual revenues of $1.2 million and annual expenses exclusive of depreciation of $700,000. Depreciation amounts to $200,000 per year. These figures ar...

Q: Benford Inc. is planning to open a new sporting goods store

Benford Inc. is planning to open a new sporting goods store in a suburban mall. Benford will lease the needed space in the mall. Equipment and fixtures for the store will cost $200,000 and be deprecia...

Q: Last year, the French marketing subsidiary of International Pharmaceuticals Corporation (

Last year, the French marketing subsidiary of International Pharmaceuticals Corporation (IPC), a New Jersey–based drug manufacturer, earned 700,000 euros. This year, partly due to a weaker U.S. dollar...