Suppose fuzzy button clothing company is evaluating a proposed capital budgeting project (project alpha) that will require an initial investment of $400,000. the project is expected to generate the following net cash flows:

year 1 $325,000

year 2 $500,000

year 3 $500,000

year 4 $500,000

fuzzy button clothing company's weighted average cost of capital is 7%, and project alpha has the same risk as the firm's average project. based on the cash flows, what is project alpha's net present value (npv)?

a. $1,455,054

b. $1,356,065

c. $1,130,054

d. $730,054

fuzzy button clothing company's decision to accept or reject project alpha is independent of its decisions on other projects. if the firm follows the npv method, it should accept or reject project alpha.

Neveready flashlights inc. needs $317,000 to take a cash discount of 3/15, net 70. a banker will loan the money for 55 days at an interest cost of $13,200. a. what is the effective rate on the bank loan? (use a 360-day year. do not round intermediate calculations. input your answer as a percent rounded to 2 decimal places.) b. how much would it cost (in percentage terms) if the firm did not take the cash discount but paid the bill in 70 days instead of 15 days? (use a 360-day year. do not round intermediate calculations. input your answer as a percent rounded to 2 decimal places.) c. should the firm borrow the money to take the discount? no yes d. if the banker requires a 20 percent compensating balance, how much must the firm borrow to end up with the $317,000? e-1. what would be the effective interest rate in part d if the interest charge for 55 days were $7,200?

bradford, inc., expects to sell 9,000 ceramic vases for $21 each. direct materials costs are $3, direct manufacturing labor is $12, and manufacturing overhead is $3 per vase. the following inventory levels apply to 2019: beginning inventory ending inventory direct materials 3,000 units 3,000 units work-in-process inventory 0 units 0 units finished goods inventory 300 units 500 units what are the 2019 budgeted production costs for direct materials, direct manufacturing labor, and manufacturing overhead, respectively?

Coop inc. owns 40% of chicken inc., both coop and chicken are corporations. chicken pays coop a dividend of $10,000 in the current year. chicken also reports financial accounting earnings of $20,000 for that year. assume coop follows the general rule of accounting for investment in chicken. what is the amount and nature of the book-tax difference to coop associated with the dividend distribution (ignoring the dividends received deduction)?