MacNamara Development Company Is Evaluating a Possible Investment in a Construction

question 92

Multiple Choice

MacNamara Development Company is evaluating a possible investment in a construction project. The cost will be $100,000, and it will generate cash flows as follows: The VP for construction believes this project has an internal rate of return somewhere in the range of 7% to 10%, but has asked the Controller to crunch the numbers. Using the trial and error method, and the PV factors shown here, determine what the IRR of this project is.
Choose the rate below which comes closest to the actual IRR.

• A)7%
• B)8%
• C)9%
• D)10%

Differentiate between various laws governing employment and labor relations.

Recognize the balance between company property rights and worker labor rights.

Identify statutory, common, and case laws and understand their impact on labor relations.

Analyze the evolution of public and private sector unions and their legal rights.

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Definitions:

Allowance Method

The Allowance Method is an accounting technique that estimates and accounts for doubtful accounts, reducing the accounts receivable to its net realizable value.

Going Concern Assumption

An accounting principle assuming that an entity will continue to operate for the foreseeable future.

Direct Method

An approach to preparing the cash flow statement where actual cash flows from operating activities are listed.