Ross: Fundamentals of Corporate Finance 9ce

Errata
Chapter 2

Page 66 – Question 29

Currently reads:

A piece of newly purchased industrial equipment costs $1,000,000. It is Class 8 property with a CCA rate
of 20 percent. Calculate the annual depreciation allowances and end-of-year book values (UCC) for the
first five years.

It should read:

A piece of newly purchased industrial equipment costs $1,000,000. It is Class 8 property with a CCA rate
of 20 percent. Calculate the annual CCA and end-of-year book values (UCC) for the first five years.

Chapter 6

Page 209 – Question 35

Currently reads:

You want to be a millionaire when you retire in 40 years. How much do you have to save each month if
you can earn 11 percent annual return? How much do you have to save if you wait ten years before you
begin your deposits? 20 years? Assume that the APR is compounded monthly.

It should read:

You want to be a millionaire when you retire in 40 years. How much do you have to save each month if
you can earn an 11 percent annual return? How much do you have to save if you wait ten years before
you begin your deposits? 20 years? Assume that the APR is compounded monthly.

Chapter 10

Page 379 – Question 41

Currently reads:

Whichever project is chosen, it will not be replaced when it wears out. If the tax rate is 34 percent and
the discount rate is 82 percent, which project should the firm choose?

It should read:
Whichever project is chosen, it will not be replaced when it wears out. If the tax rate is 34 percent and
the discount rate is 8 percent, which project should the firm choose?

Chapter 11

Page 423 – Question 28

Is missing the question stem; it should read:

Victoria Sailboats Limited is considering whether to launch its new Mona-class sailboat. The selling price
would be $40,000 per boat. The variable costs would be about half that, or $20,000 per boat, and fixed
costs will be $500,000 per year.

The Base Case: The total investment needed to undertake the project is $3.5 million for leasehold
improvements to the company’s factory. This amount will be depreciated straight-line to zero over the
five-year life of the equipment. The salvage value is zero, and there are no working capital
consequences. Victoria has a 20 percent required return on new projects.

Chapter 17

Page 689 – Question 5 - Textbook Only

The total amount of assets in the left column currently reads 397,900. Below is the correct table.