If a garden center is considering the purchase of a new tractor with an initial investment cost of $106,000, and the center expects a return of $28,000 in year one, $22,000 in years two and three, $13,000 in years four and five, and $8,000 in year six and beyond, what is the payback period? fill in the blank  years

Q: As a financial analyst, you must evaluate a proposed project to produce printer cartridges. The…

A: The question is based on the concept of Project Valuation

Q: The plant manager at a company would like to perform an analysis for a new $250,000 machine. If she…

A: Payback period method is a traditional method used in capital budgeting decisions which is used to…

Q: after a lengthy meeting with the marketing team about a new product being introduced, your boss asks…

A:

Q: Salalah Methanol Co. has bought some new machinery at a cost of 1250000 OMR. The impact of the new…

A: A capital project is an investment that requires huge capital investment and is expected to be in…

Q: Alpha Zeta is considering purchasing some new equipment costing $390,000. The equipment will be…

A: Average accounting rate of return is the ratio of average net income to average investment. Average…

Q: The expenses included in the fabrication of a wind turbine for a planned Wind Farm is $73,000…

A: Investment needed today (X) = $16000 First year cost saving (S1) = $73000 - $58000 = $15000 S2 to S5…

Q: You are evaluating a project for a superior pickleball paddle.  You estimate the sales price to be…

A: NPV It is a capital budgeting tool to decide on whether the capital project is beneficial for the…

Q: A Volvo truck can be acquired for $50,000 today and is expected to have a life of four years with…

A: The PV analysis is used to find out the profitability of a project. It calculates the PV of the…

Q: A supermarket is planning on piloting a self- checkout system in one of its stores. It estimates…

A: Payback period is time required to generate the cashflow equal to initial investment .

Q: Suppose that you have just completed the mechanical design of an equipment that has an investment…

A: Annual Depreciation (straight line method) = (Cost of the assets - Residual value) / Expected life…

Q: A supermarket is planning on piloting a self-checkout system in one of its stores. It estimates that…

A: Conventional Pay back period is the time the project takes to recover initial investment in nominal…

Q: You are considering a luxury apartment building project that requires an investment of $12,500,000.…

A: For this we have to do NET PRESENT VALUE (NPV) analysis.

Q: Developers are going to install an airconditioning system in their building and, as a consequence,…

A: Estimated Uniform Annual Cost (EUAC) method shows the life cycle costs of a project by measuring an…

Q: The Cooper Company is considering investing in a recuperator. The recuperator will have an initial…

A: The minimum value of cost savings is the present value of total cost less the PV of salvage value…

Q: Your firm is thinking about investing $200,000 in the overhaul of a manufacturing cell in a lean…

A: Calculation of annual equivalent worth: Investment = $200,000 Revenues = $30,000  Expenses = $10,000…

Q: 3. The Kasibu Cooperative has invested a 145,000 new mechanical grading/sorter system which is…

A: The future worth method of project appraisal includes the calculation of the future value of all…

Q: A new equipment is being considered to replace an old equipment in a facility. The equipment would…

A: New Equipment Cost = $7,480 Life =15 years Discount Rate = 6% Year 10 = Special Maintenance to be…

Q: A farm must decide whether or not to purchase anew tractor.The tractor will reduc costs by $2,000 in…

A: Net Present value: Net present value method is the method which is used to compare the initial cash…

Q: If a garden center is considering the purchase of a new tractor with an initial investment cost of…

A: Payback period is defined as time taken to recover original investment. Hence if payback period is…

Q: You are considering developing an 18-hole championship golf course thatrequires an investment of…

A: Formula:

Q: What is the annual operation and maintenance costs of owning this vehicle?

A: Time value of money (TVM) is used to measure the value of money at different point of time in the…

Q: A project your firm is considering for implementation has these estimated costs and revenues: an…

A: The present value of all the inflows and outflows of cash in the future are discounted to the…

Q: A restaurant is considering the purchase of new tables and chairs for their dining room with an…

A: Payback period = Initial investment / Annual cash flow

Q: You are considering a luxury apartment building project that requires an investment of $15,000,000.…

A: Answer:-  Return on investment meaning:- The ratio of net income to investment is generally known as…

Q: Assume the following facts:• A project will cost $45,000 to develop.• When the system becomes…

A: Computation:

Q: Grayson Company is considering a purchase of equipment that costs $62,000 and is expected to offer…

A: Capital Budgeting Decision: In most cases, a capital budgeting choice is either a yes or no decision…

Q: Management of Blossom Mints, a confectioner, is considering purchasing a new jelly bean-making…

A: NPV is a method of capital budgeting that involve discounting the future cash flows to present…

Q: If a copy center is considering the purchase of a new copy machine with an initial investment cost…

A: Payback period is a amount of time it takes to recover the investment. In other words it is a time…

Q: The following problem is designed to be solved by spreadsheet. Maintenance costs for a new facility…

A: Present value is the current worth of an amount of money in future. The future amount is…

Q: You are considering a luxury apartment building project that requires an investment of $12,500,000.…

A: The calculation is:

Q: During an executive meeting, managers are reviewing potential projects for the incoming year. A…

A: Present Worth In this method the cash flows are discounted to a single present value. MARR is used…

Q: The manufacture of equipment costs $73,000 per year. An engineer finds that by spending $16,000 now…

A: Costs per year= 73000 Initial Cost = 16000 Updated costs per year: Year Cash Outflow 1 -58000…

Q: Management of Crane Home Furnishings is considering acquiring a new machine that can create…

A: Given: Initial investment is $209,550 Cash flows = $83,750 for 6 years Cost of capital is 11%

Q: You purchased a stamping machine for $100,000 to produce a new line of products. The stamping…

A: SOLUTION- GIVEN,             MACHINE COST =100000                  REVENUE       = 12…

Q: If a copy center is considering the purchase of a new copy machine with an initial investment cost…

A: Note : As per the Q&A guideline we are required to answer the first question only ,please post…

Q: For your new laboratory, you plan to purchase energy efficient freezers. There are two models in the…

A:

Q: If a copy center is considering the purchase of a new copy machine with an initial investment cost…

A: Payback period = Initial cost / annual cashflow

Q: A truck can be purchased for $55,000. Annual O&M costs are expected to increase by $1,800 every…

A: A) Replacement Interval Optimal (1) Equivalent estimated cost of a new machine- a)New machine cost =…

Q: The engineering team at Manuel’s Manufacturing, Inc., is planning to purchase an enterprise resource…

A: a) Computation:

Q: If a garden center is considering the purchase of a new tractor with an initial investment cost of…

A: Payback period is indicator of how much period, the project takes to return the initial investment.

Q: For your new laboratory, you plan to purchase energy efficient freezers. There are two models in the…

A: Solution: Compute Present costs: Present cost of model X =…

Q: If a garden center is considering the purchase of a new tractor with an initial investment cost of…

A: The payback period is the total number of years required to recover the total cost of the…

Q: You are considering making an $80,000 investment in a process improvement project. Revenues are…

A: Annual Equivalent worth of the project is the net present value of cash flows divided by equivalent…

Q: Consider a new electric forklift truck that would cost $18,000, have operating costs of $1,000 in…

A: Efficiency and profitability is depends upon the machine. Effective production provide high…

Q: Management of Sunland Home Furnishings is considering acquiring a new machine that can create…

A: Capital budgeting technique is used to analyze the projects or alternatives present for the…

Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.