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A 5-year project requires a $20,000 investment in machinery that will be depreciated on a straight-line basis to a value of $0 over its 5-year life. The project will have net income of $6,000 per year and operating cash inflows of $7,500 per year. What is the payback period?

Last year, you purchased a stock at a price of $70.00 a share. Over the course of the year, you received $1.50 per share in dividends and inflation averaged 2 percent. Today, you sold your shares for $73.20 a share. What is your approximate real rate of return on this investment?

The terms of sale generally include all of the following except the:

You have calculated the pro forma net income for a new project to be $46,200. The incremental taxes are $22,890 and incremental depreciation is $16,950. What is the operating cash flow?

A cost-cutting project will decrease costs by $66,300 a year. The annual depreciation will be $15,900 and the tax rate is 21 percent. What is the operating cash flow for this project?

Able Movers is evaluating a project with cash flows of −$12,800, $7,400, $11,600, and −$3,200 for Years 0 to 3, respectively. Given an interest rate of 8 percent, what is the MIRR using the discounted approach?

One year ago, you purchased a stock at a price of $56.94 per share. Today, you sold your stock at a loss of 18.87 percent. Your capital loss was $13.34 per share. What was the total dividends per share paid on this stock over the year?

Drinkable Water Systems is analyzing a project with projected cash flows of $127,400, $209,300, and –$46,000 for Years 1 to 3, respectively. The project costs $251,000 and has been assigned a discount rate of 12.5 percent. Should this project be accepted based on the discounting approach to the modified internal rate of return? Why or why not?

Colin is analyzing a 3-year project that has an initial cost of $199,800. This cost will be depreciated straight-line to zero over three years. The projected annual net income for the three years is $11,600, $15,900, and $17,200. If the discount rate is 12 percent, what is the average accounting rate of return?

Project A has cash flows of –$74,900, $18,400, $26,300, and $57,100 for Years 0 to 3, respectively. Project B has cash flows of –$79,000, $18,400, $22,700, and $51,500 for Years 0 to 3, respectively. Both projects are independent, have multiple noncash expenses, and use straight-line depreciation to a zero balance over the project’s life. Neither project has any salvage value. Both projects have a required accounting return of 11.5 percent. Should you accept or reject these projects based on the average accounting return?