KU Online Exam Solution: Financial Accounting and Management - BA7001

This assignment solution covers key concepts in financial accounting and financial management. It begins with calculations related to capital allowances, including tax benefits and written-down values. The solution then delves into project feasibility analysis using the net present value (NPV) approach, evaluating cash flows and present values. It also explores the payback period method. The assignment further analyzes investment decisions, comparing different replacement cycles using real discount rates and equivalent annual costs (EAC). It examines the drawbacks of annual equivalent annuity methods and the internal rate of return (IRR) and includes a discussion on business and financial risk. Additional topics covered include capital budgeting, including NPV calculations under different scenarios, and the impact of capital rationing in perfect capital markets. Finally, it discusses trade credit and agency costs concerning gearing decisions.