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Q: A widget machine will cost $480,000. The anticipated increase in revenue will be $140,000/year for…
A: Cost of the machine = $480000 Revenue increase for 5 years = $140000 Annual expenses for 5 years =…
Q: value aft
A: Service Output Method also known as Working Hours Method. The formula : Depreciation per hour as, =…
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A: Double declining depreciation rate = Straight line depreciation rate x 2 = (100/10 years) x 2 = 20%…
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A: 1) Statement showing equivalent uniform annual cost associated with this equipment when 10.000 units…
Q: A machine, costing $25000 to buy and $ 3000 per year to operate, will save mainly labor expenses in…
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Q: compute the rate of return.
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A: Data given:: P= -$100,000 Savings per year = $60,000 Cost per year = - $10,000 Salvage value at the…
Q: A widget machine will cost $480,000. The anticipated increase in revenue will be $140,000/year for…
A: Internal rate of return is the rate expressed in percentage terms which equalize the net present…
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Q: You are considering a manufacturing equipment that has a cost of $100,000. The equipment is expected…
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A: given information equipment costing = $100,000 useful life= 6 years resale value = 8000 annual cost…
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Q: A machine costs Php 30,000 to purchase. The machine will have a Maintenance cost of Php 2,000 but…
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A: The formula for EUAC = r*NPV/(1-(1+r)^(-n)) Let us first find the NPV. Rate = 9.8% compounded…
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A: Accounting rate of return (ARR) for an investment can be calculated as follows:-
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A: Payback period means the period when we get back our investment amount. Formula for payback period…
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A: a) Average annual rate of return = Average Annual Earning per year / Investment value
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A: In order to find the rate of return one has to know the purchased amount and the amount for it was…
Q: Consider a piece of industrial equipment that has an installed cost of $ 100,000. The equipment is…
A: Answer : Present value of Annual Savings is calculated as under: Total Present Value of Annual…
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A: PW(present worth cost)=P50,000 INT(interest rate) i = 0.12 repair cost P4,000 occurs every 4…
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Q: An industrial firefighting truck costs $100,000. Savings in insurance premiums and uninsured losses…
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Q: Investment cost twenty thousand dollars, annual income (gain) 8000 dollars / year, duration 5 years;…
A: The investment should be made if the net future value of the cash flows is positive.
Q: The management of XYZ Beverage Company is considering to purchase a new equipment to increase the…
A: Payback period: It can be defined as the time that is taken by an investment before it starts…
Q: A company that manufactures brushless blowers invested $650,000 in an automated quality control…
A: IRR is the rate of return a project generates through its lifetime expressed in annual terms. It is…
Q: Two techniques can be used to produce expansion anchors. Technique A costs $90,000 initially and…
A: Present worth analysis:Project A:Computation of present worth is as follows:-Initial cost+Salvage…
Q: The management of XYZ Beverage Company is considering to purchase a new equipment to increase the…
A: Annual Net cash inflows = Annual cash inflows - (Cost of ingredients + Salaries expense +maintenance…
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A: The question is based on the concept of Annuity and Present value in Financial Management. Annuity…
Q: ₱50000 is invested in a machine, in which it has an annual total cost of ₱3000 and a salvage value…
A: Solution:- Calculation of the equivalent uniform annual cost of this cycle as follows under:-
Q: A machine cost 80,000 and the salvage value after 20 years is 20,000. Find the equivalent annual…
A: Concept. Equivalent annual worth cost is computed when net present value of cashflows are divided…
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A: IRR is discount rate at which total of discounted inflows gets equal to discounted value of outflows…
A equipment costs $35,000, O&M = $1500/year. Savings = $12,000/year. Salvage @ 5 years = $6500. Find
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- Caduceus Company is considering the purchase of a new piece of factory equipment that will cost $565,000 and will generate $135,000 per year for 5 years. Calculate the IRR for this piece of equipment. For further instructions on internal rate of return In Excel, see Appendix C.Garnette Corp is considering the purchase of a new machine that will cost $342,000 and provide the following cash flows over the next five years: $99,000, $88,000, $92,000. $87,000, and $72,000. Calculate the IRR for this piece of equipment. For further instructions on internal rate of return in Excel. see Appendix C.Consolidated Aluminum is considering the purchase of a new machine that will cost $308,000 and provide the following cash flows over the next five years: $88,000, 92,000, $91,000, $72,000, and $71,000. Calculate the IRR for this piece of equipment. For further instructions on internal rate of return in Excel, see Appendix C.
- Your company is planning to purchase a new log splitter for is lawn and garden business. The new splitter has an initial investment of $180,000. It is expected to generate $25,000 of annual cash flows, provide incremental cash revenues of $150,000, and incur incremental cash expenses of $100,000 annually. What is the payback period and accounting rate of return (ARR)?Falkland, Inc., is considering the purchase of a patent that has a cost of $50,000 and an estimated revenue producing life of 4 years. Falkland has a cost of capital of 8%. The patent is expected to generate the following amounts of annual income and cash flows: A. What is the NPV of the investment? B. What happens if the required rate of return increases?Average rate of returncost savings Maui Fabricators Inc. is considering an investment in equipment that will replace direct labor. The equipment has a cost of 125,000 with a 15,000 residual value and an eight-year life. The equipment will replace one employee who has an average wage of 28,000 per year. In addition, the equipment will have operating and energy costs of 5,150 per year. Determine the average rate of return on the equipment, giving effect to straight-line depreciation on the investment.
- A restaurant is considering the purchase of new tables and chairs for their dining room with an initial investment cost of $515,000, and the restaurant expects an annual net cash flow of $103,000 per year. What is the payback period?Mason, Inc., is considering the purchase of a patent that has a cost of $85000 and an estimated revenue producing lite of 4 years. Mason has a required rate of return that is 12% and a cost of capital of 11%. The patent is expected to generate the following amounts of annual income and cash flows: A. What is the NPV of the investment? B. What happens if the required rate of return increases?Net Present Value Talmage Inc. has just completed development of a new printer. The new product is expected to produce annual revenues of 2,700,000. Producing the printer requires an investment in new equipment costing 2,880,000. The printer has a projected life cycle of 5 years. After 5 years, the equipment can be sold for 360,000. Working capital is also expected to increase by 360,000, which Talmage will recover by the end of the new products life cycle. Annual cash operating expenses are estimated at 1,620,000. The required rate of return is 8%. Required: Prepare a schedule of the projected annual cash flows. Calculate the NPV using only discount factors from Exhibit 12B.1 (p. 670). Calculate the NPV using discount factors from both Exhibits 12B.1 and 12B.2 (p. 671).
- Project X costs $10,000 and will generate annual net cash inflows of $4,800 for five years. What is the NPV using 8% as the discount rate?Manzer Enterprises is considering two independent investments: A new automated materials handling system that costs 900,000 and will produce net cash inflows of 300,000 at the end of each year for the next four years. A computer-aided manufacturing system that costs 775,000 and will produce labor savings of 400,000 and 500,000 at the end of the first year and second year, respectively. Manzer has a cost of capital of 8 percent. Required: 1. Calculate the IRR for the first investment and determine if it is acceptable or not. 2. Calculate the IRR of the second investment and comment on its acceptability. Use 12 percent as the first guess. 3. What if the cash flows for the first investment are 250,000 instead of 300,000?A mini-mart needs a new freezer and the initial Investment will cost $300,000. Incremental revenues, including cost savings, are $200,000, and incremental expenses, including depreciation, are $125,000. There is no salvage value. What is the accounting rate of return (ARR)?
