Description of this paper

saint MBA560 test 8

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solution


Question

Question;Problem 1. Creighton Company's balance sheet and income;statement are provided below;Required;1) Compute the margin, turnover, and return on investment for Creighton;Company.;2) What is the advantage of expanding the ROI formula to measure margin and;turnover separately?Problem 2. Delta Company is;evaluating two different capital investments, Project X and Y. Either X or Y;would cost $100,000, and the company cannot afford to do both. The company;expects that Project X would provide net cash inflows of $30,000 per year for 5;years. For Project Y, the net cash inflows are expected to be as follows;Delta's cost of capital is 12%;Required:1) Calculate the present value index for Project;X and for Project Y.;2) Indicate whether each of the projects is an acceptable investment.;3) Which of the two projects should Delta implement?

 

Paper#50918 | Written in 18-Jul-2015

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