A Machine Costing P720,000 is estimated to have a book value of P40,545.73 when retired at the end of 10 years. Depreciation cost is computed using a constant percentage of the declining value. What is the annual rate of depreciation in %?
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A Machine Costing P720,000 is estimated to have a book value of P40,545.73 when retired at the end of 10 years.
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- A machine that costs $8,000 is expected to operate for 10 years. The estimated salvage value at the end of 10 years is $0. The machine is expected to save the company $1,554 per year before taxes and depreciation. The company depreciates its assets on a straight-line basis and has a marginal tax rate of 35 percent. What is the internal rate of return on this investment?Mytown’s street department repaves a street every 8 years. Potholes cost $15,000 per mile beginning at the end of Year 3 after construction or repaving. The cost to fix potholes generally increases by $15,000 each year. Repaving costs are $200,000 per mile. Mytown uses an interest rate of 8%. What is the EUAC for Mytown’s policy? What is the EUAC for the optimal policy? What is the optimal policy?The plant manager may purchase a piece of unusual machinery for $10,000. Its resale value after 1 year is estimated to be $3000. Because the device is sought by antique collectors, resale value is rising $500 per year.An online news platform is hosting sports news on a local webserver. Assuming the webserver is valued at $10,000. This webserver crashed 7 times in one year and in every crash, it resulted in a 3% loss. Calculate the expected losses using single loss expectancy (SLE) and annualize Loss expectancy (ALE)
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- The army is attempting to determine the optimal replacement age for a piece of field equipment. The equipment costs $280,000 to replace. The manufacturer will supply a rebate toward the next purchase that declines at a rate of 20 percent per year. Maintenance costs for the first year are estimated to be $1,000, and they increase roughly at the rate of 18 percent per year. Estimate the number of years that the army should hold the equipment before making a replacement.(Production and Operation Analysis by Steven Nahmias, 7th edition, pg.774 Problem # 24)A company owns a 5-year-old turret lathe that has a book value of $23,000. The present market value for the lathe is $18,000. The expected decline in market value is $1,700/year to a minimum market value of $4,080; maintenance plus operating costs for the lathe equal $4,470/year.A new turret lathe can be purchased for $46,000 and will have an expected life of 8 years. The market value for the turret lathe is expected to equal $46,000(0.70)k at the end of year k. Annual maintenance and operating cost is expected to equal $1,900. Based on a 12% MARR, should the old lathe be replaced now? Use an equivalent uniform annual cost comparison, a planning horizon of 7 years, and the cash flow approach.EUAC for keeping old turret lathe: $EUAC for replacing turret lathe: $A firm is considering the installation of an automatic data processing unit to handle some of its accounting operations. Machines for that purpose may be purchased for 20,000 or may beleased for 8,000 for the first year and 1,000 less every year now and then until the end of the fourth year. If money is worth 15%, is it advisable to rent or buy a machine?
- Please complete all work in excel. Use excel to make the calculations (cells can be clicked on to view any formulas used) and be sure to identify your answer, including units. You must have an excel file with formulas within the cell. An operations manager must purchase new equipment has developed a table of conditional values for the various alternatives (equipment options) and states of nature (demand market conditions). states of nature (market conditions) Alternatives Good Average Poor X800 $38,000 $21,000 -$18,000 Y900 $33,000 $16,000 -$12,000 Z1000 $29,000 $19,000 $6,000 If the probabilities associated with the states of nature are 0.40 for a good market, 0.40 for an average market, and 0.20 for a poor market, determine: 1. the alternative that provides the greatest expected monetary value (EMV)Please complete all work in excel. Use excel to make the calculations (cells can be clicked on to view any formulas used) and be sure to identify your answer, including units. You must have an excel file with formulas within the cell An operations manager must purchase new equipment has developed a table of conditional values for the various alternatives (equipment options) and states of nature (demand market conditions). states of nature (market conditions) Alternatives Good Average Poor X800 $38,000 $21,000 -$18,000 Y900 $33,000 $16,000 -$12,000 Z1000 $29,000 $19,000 $6,000 If the probabilities associated with the states of nature are 0.40 for a good market, 0.40 for an average market, and 0.20 for a poor market, determine: 2. the expected value of perfect information (EVPI)A project will cost $45,000 to develop.• When the system becomes operational after a one-year development period, operational costs willbe $9,000 during each year of the system’s five-year useful life.• The system will produce benefits of $30,000 in the first year of operation, and this figure willincrease by a compound 10% each year.What is the payback period for this project?