Calculations of stable and metastable magnetic states as well as minimum energy paths for transitions between states are carried out using a noncollinear extension of the multiple-impurity Alexander-Anderson model and a magnetic force theorem which is derived and used to evaluate the total energy gradient with respect to orientation of magnetic moments - an important tool for efficient navigation on the energy surface. By using this force theorem, the search for stable and metastable magnetic states as well as minimum energy paths revealing the mechanism and activation energy of transitions can be carried out efficiently. For Fe monolayer on W(110) surface, the model gives magnetic moment as well as exchange coupling between nearest and next-nearest neighbors that are in good agreement with previous density functional theory calculations. When applied to nanoscale Fe islands on this surface, the magnetic moment is predicted to be 10% larger for atoms at the island rim, explaining in part an experimentally observed trend in the energy barrier for magnetization reversal in small islands. Surprisingly, the magnetic moment of the atoms does not change much along the minimum energy path for the transitions, which for islands containing more than 15 atom rows along either  or [11̄0] directions involves the formation of a thin, temporary domain wall. A noncollinear magnetic state is identified in a 7×7 atomic row Fe island where the magnetic moments are arranged in an antivortex configuration with the central ones pointing out of the (110) plane. This illustrates how the model can describe complicated exchange interactions even though it contains only a few parameters. The minimum energy path between this antivortex state and the collinear ground state is also calculated and the thermal stability of the antivortex state estimated.