The constant monthly withdrawal amount can be calculated by using PMT function in excel as in =PMT(rate,nper,pv) where rate = 7% = 0.07/12 (Monthly rate), nper = 20 years = 20*12 = 240 months and pv = 300,000
Constant monthly withdrawal amount =PMT(0.07/12,240,300000)
Constant monthly withdrawal amount = $2,325.90
Constant monthly withdrawal amount = $2,326 (Option C)
Answer:
95%, 73.1%
Explanation:
Actual output= 950 per year
Design capacity= 1300 per year (Theoretical capacity)
Effective capacity= 1000 per year (efficiency of the shop)
Now Efficiency = actual output/effective capacity = 950/1000 = 0.95, 95.0%
Utilization= actual output/ design capacity = 950/1300 = 0.7308, 73.1%
Answer:
The projects which maximize Vanguard's shareholder wealth are Project A; Project B; Project D.
Explanation:
Projects which maximize the shareholder value are projects delivering Expected Returns which are higher than its risk-adjusted weighted average cost of capital (WACC).
As a result, Project A with Expected return of 15% and risk adjusted WACC of 12%; Project B with Expected return of 12% and risk adjusted WACC of 10%; Project D with Expected return of 9% and risk adjusted WACC of 8%; are the projects that maximize the shareholder's value.
On the other hand, Project C with Expected return of 11% and risk adjusted WACC of 12% is harmful to shareholder value.
Answer:
c. $86,000
Explanation:
The operating activities in the cash flow is the area where day to day business activities are recorded. This area mainly covers the cash incoming and outgoing due to regular business activities. The company paid dividends to its shareholders this will be considered as a financing activity as it is not of regular nature.
