Find the net present value (NPV) for the following series of future cash flows,

Question

Find the net present value (NPV) for the following series of future cash flows, assuming the company’s cost of capital is 13.57 percent. The initial outlay is $346,897.

Year 1: 151,782

Year 2: 152,908

Year 3: 173,713

Year 4: 139,628

Year 5: 127,498

Round the answer to two decimal places.

Your Answer:

3.

A project has an initial outlay of $2,774. It has a single cash flow at the end of year 4 of $4,755. What is the internal rate of return (IRR) for the project?

Round the answer to two decimal places in percentage form. (Write the percentage sign in the "units" box)

Your Answer:

4. Find the profitability index (PI) for the following series of future cash flows, assuming the company’s cost of capital is 9.12 percent. The initial outlay is $405,826.

Year 1: $140,542

Year 2: $181,757

Year 3: $144,962

Year 4: $131,610

Year 5: $150,851

Round the answer to two decimal places.

Your Answer:

5.

Black Hill Inc. sells $100 million worth of 20-year to maturity 13.12% annual coupon bonds. The net proceeds (proceeds after flotation costs) are $981 for each $1,000 bond. What is the before-tax cost of capital for this debt financing?

Round the answer to two decimal places in percentage form. (Write the percentage sign in the "units" box)

You should use Excel or financial calculator.

6.

The Black Bird Company plans an expansion. The expansion is to be financed by selling $61 million in new debt and $48 million in new common stock. The before-tax required rate of return on debt is 11.23% percent and the required rate of return on equity is 13.77% percent. If the company is in the 34 percent tax bracket, what is the weighted average cost of capital?

Round the answer to two decimal places in percentage form. (Write the percentage sign in the "units" box)

Explanation / Answer

As per Chegg Guidelines we answer one question per post. I have answered more than 1 question. Kindly post remaining questions in separate post to get the best answers Statemnet showing Cash flows Particulars Time PVf@13.57% Amount PV Cash Outflows                            -                        1.00 (346,897.00)    (346,897.00) PV of Cash outflows    (346,897.00) Cash inflows                     1.00                 0.8805     151,782.00      133,646.21 Cash inflows                     2.00                 0.7753     152,908.00      118,550.38 Cash inflows                     3.00                 0.6827     173,713.00      118,588.19 Cash inflows                     4.00                 0.6011     139,628.00         83,930.15 Cash inflows                     5.00                 0.5293     127,498.00         67,481.58 PV of Cash Inflows      522,196.51 NPV      175,299.51 Statemnet showing Cash flows Particulars Time PVf@9.12% Amount PV Cash Outflows                            -                        1.00 (405,826.00)    (405,826.00) PV of Cash outflows    (405,826.00) Cash inflows                     1.00                 0.9164     140,542.00      128,795.82 Cash inflows                     2.00                 0.8398     181,757.00      152,644.95 Cash inflows                     3.00                 0.7696     144,962.00      111,568.37 Cash inflows                     4.00                 0.7053     131,610.00         92,826.39 Cash inflows                     5.00                 0.6464     150,851.00         97,504.89 PV of Cash Inflows      583,340.42 NPV      177,514.42 PI = PVCI/PVCO PI = 583,340.42/405,826 PI = 1.44

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