hould the total of your accounts receivable schedule agree with the balance of the Accounts Receivable account in the general ledger at January 31, 2019?
January 3, 2018
If the cost of common equity for the firm is 18.9%, the cost of preferred strock is 9.3%, the before-tax cost of debt is 7.9% , and the firm’s tax rate is 35%,what is QM’s weighted average cost of capital?
January 3, 2018

Compute the NPV of the project

Finance Basics

MRE Sales is looking to acquire an ERP and has asked for your assistance. The company can purchase the system outright for $120,000 plus 5% sales tax, and delivery and install charges of $2,000. The ERP is expected to last 5 years and have a salvage value of $8,000. The company will use straight-line depreciation over the 5-year life. Its income tax rate is 40%. The company’s cost of capital is 12%. The system is expected to bring annual benefits of $35,000 over the 5-year period. Showing all calculations in Excel:

a. Compute the NPV of the project

b. Compute its payback period

 

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