Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. finance question, help please pappy's potato has

Finance question, help please Pappy's Potato has come up with a new product, the...

70.2K

Verified Solution

Question

Accounting

imageFinance question, help please

Pappy's Potato has come up with a new product, the Potato Pet (they are freeze-dried to last longer). Pappy's paid $195,000 for a marketing survey to determine the viability of the product. It is felt that Potato Pet will generate sales of $910,000 per year. The fixed costs associated with this will be $234,000 per year, and variable costs will amount to 22 percent of sales. The equipment necessary for production of the Potato Pet will cost $1,000,000 and will be depreciated in a straight-line manner for the four years of the product life (as with all fads, it is felt the sales will end quickly). This is the only initial cost for the production. Pappy's has a tax rate of 25 percent and a required return of 15 percent. a. Calculate the payback period for this project. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. Calculate the NPV for this project. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) c. Calculate the IRR for this project. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) years a. Payback period b. NPV IRR

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Q

Financial ratios are essential to assessing to provide an accurate valuation of a firm. Select a...

Finance
Q

Identify the single most acidic or basic principle species in each of the following solutions. Calculate...

Chemistry
Q

Class: Hydraulic Engineering Hot and cold water Plumbing systems. The design criteria and methods?

Civil Engineering
Q

estion Completion Status QUESTION 2 hospholipids with shorter fatty acid chains and or more hore...

Biology
Q

Give the complex number of point A yi B 6 5 4 3 20 1...

Basic Math
Q

The eighth term in the sequence 512 256 128 64 is a 2 b 1...

Basic Math
Q

y b 4 4 0 a f 1 6 f 3 c F 4 2...

Calculus
Q

Salary Vs. Dividend Decisions - Optimum Mix Ms. Barbra Stickle is the only shareholder of...

Accounting
Q

A manufacturer uses 37,500 units of a particulars material per year. The material cost is...

Accounting
Q

On January 2, 2018, the Jackson Company purchased equipment to be used in its manufacturing...

Accounting
Q

What are 5 characteristics of a partnership? Be detailed in your descriptions of each characteristic....

Accounting
Q

27. o 28. O 29. 0 30. 0 Suppose in the spot market 1 U.S....

Accounting