Global Enterprises Is Considering a New 5-Year Project That Will

question 78

Multiple Choice

Global Enterprises is considering a new 5-year project that will require $872,000 for new fixed assets,$210,000 for inventory,and $80,000 for accounts receivable.Short-term debt is expected to increase by $140,000.The fixed assets will be depreciated straight-line to zero over the project's life.At the end of the project,the fixed assets are expected to be sold for 30 percent of their original cost,and the net working capital will return to its original level.The tax rate is 35 percent.What is the initial cost of this project?

• A)$446,040
• B)$1,022,000
• C)$726,040
• D)$1,302,000
• E)$170,040

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Definitions:

Flat-Panel Televisions

Modern thin televisions that utilize LCD, LED, or Plasma technology for display, offering clearer pictures and space-saving advantages.

Technology Associated

Refers to the tools, machinery, and systems used to enhance production, efficiency, and innovation in various fields.

Quantity Supplied

The amount of a good or service that producers are willing and able to sell at a specific price during a specified period.

Increase

An upward movement in quantity, size, value, or some other measure, indicating growth or escalation.