(Appendix 13C) Boynes Corporation Is Considering a Capital Budgeting Project

question 64

Multiple Choice

(Appendix 13C) Boynes Corporation is considering a capital budgeting project that would require investing $200,000 in equipment with an expected life of 4 years and zero salvage value. Annual incremental sales would be $490,000 and annual incremental cash operating expenses would be $330,000. The project would also require an immediate investment in working capital of $10,000 which would be released for use elsewhere at the end of the project. The project would also require a one-time renovation cost of $70,000 in year 3. The company's income tax rate is 30% and its after-tax discount rate is 14%. The company uses straight-line depreciation. Assume cash flows occur at the end of the year except for the initial investments. The company takes income taxes into account in its capital budgeting.
-The net present value of the entire project is closest to:

• A) $259,000
• B) $126,876
• C) $214,750
• D) $132,796

Recognize the importance of using the indirect approach for delivering negative messages.

Distinguish between the direct and indirect approaches in negative communication.

Identify effective strategies for crafting sincere apologies in a business context.

Know how to construct a buffer in a negative message for smoother communication.

---

Definitions:

Surnames

Last names or family names used to identify individuals, often passed down through generations.

Financial Obligation

A legal requirement to pay debt or fulfill financial contracts or agreements.

Competing Partnership

A business arrangement where partners are involved in separate ventures that directly compete with each other.

Active Part

The involvement or engagement in activities or actions, often implying a significant role in the process or outcome.