FIN 370 Course Great Wisdom / tutorialrank.com FIN 370 Course Great Wisdom / tutorialrank.com | Page 32

• Ch . 11 : Questions 1 & 7 ( Questions and Problems section )
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• Ch . 9 : Questions 7 & 8 ( Questions and Problems section )
7 . Calculating IRR [ LO5 ] A firm evaluates all of its projects by applying the IRR rule . If the required return is 14 percent , should the firm accept the following project ?
8 . Calculating NPV [ LO1 ] For the cash flows in the previous problem , suppose the firm uses the NPV decision rule . At a required return of 11 percent , should the firm accept this project ? What if the required return is 24 percent ?
• Ch . 10 : Questions 3 & 13 ( Questions and Problems section )
3 . Calculating Projected Net Income [ LO1 ] A proposed new investment has projected sales of $ 635,000 . Variable costs are 44 percent of sales , and fixed costs are $ 193,000 ; depreciation is $ 54,000 . Prepare a pro forma income statement assuming a tax rate of 35 percent . What is the projected net income ?