0
Want this question answered?
Be notified when an answer is posted
Add your answer:
Earn +20 pts
Should you consider depreciation in NPV?
Net present value calculation only considers the cash amounts and depreciation is not cash amount rather the related assets is counted in for net present value calculation. Depreciation is deducted once from net income to calculate the tax amount but after that it is added back.
The NPV assumes cash flows are reinvested at the?
The NPV assumes cash flows are reinvested at the: A. real rate of return B. IRR C. cost of capital D. NPV
What is number of years purchase in goodwill calculation?
it is the time till the annuity pays back. or it is the time till the brand name of existing setup is needed to continue business
Do goodwill depreciate?
No; goodwill can not be depreciated because goodwill is not considered to have a useful life.
Calculate rate of return?
NPV/Initial Cost of Investment
What is the treatment of Sunk costs for Npv calculation?
Exclude sunk costs.
What is the need for calculation of goodwill.why an organition will adopt the calculation of goodwill by super profit method?
we know goodwill is anintangible fixed asset. So to find out the actual value of the company we need to the value of the goodwill. Among the other methods super-profit method is the method considering the realistic situation.
Does lower WACC equal lower NPV?
no it increases npv
Can a second job's income be included in child support calculation. What if it is seasonal work 3 - 4 months a year?
Can a second job's income be included in child support calculation.
What sub atomic particle does not particitpate in the calculation of mass of atom?
Mass of electron is not included for the calculation of mass of an atom.
Is examination time included in credit hour calculation?
yes
What happens to NPV when cost of capital increased?
NPV decreases when the cost of capital is increased.
Should you consider depreciation in NPV?
Net present value calculation only considers the cash amounts and depreciation is not cash amount rather the related assets is counted in for net present value calculation. Depreciation is deducted once from net income to calculate the tax amount but after that it is added back.
The NPV assumes cash flows are reinvested at the?
The NPV assumes cash flows are reinvested at the: A. real rate of return B. IRR C. cost of capital D. NPV
Why 1 plus r in NPV calculation?
NPV=NFV/(1+r)^n The role of the "(1+r)^n" is to discount the future money to what it is worth in todays dollars. The 1 accounts to the sum itself and the plus r takes into account the interest rate. NPV=NFV/(1+r)^n The role of the "(1+r)^n" is to discount the future money to what it is worth in todays dollars. The 1 accounts to the sum itself and the plus r takes into account the interest rate.
What are the limitations of NPV when evaluating alternative investment proposals?
NPV is not that flexible and only uses information available at the time of the decision. It does not account for changes to the projects after the initial decision is made. NPV factors in risk by using a single discount rate, but in reality choices in the future concerning the project will likely change its payoffs and risk. Try real option analysis instead if you want to get around this problem. NPV only evaluates tangible and quantifiable projects. Some projects with negative NPVs are carried out anyway because they have some kind of strategic value, eg. it shows the firm in a good light, builds goodwill or allows access to as yet unknown earnings in the future.
What two fitness parameters are included in the calculation of cardiac output?
pulse and blood pressure
