Information for two alternative projects involving machinery Investments follows. Project 1 requires an initial Investment of $245,000. Project 2 requires an Initial Investment of $175,000. Annual Amounts Sales of new product Expenses Materials, labor, and overhead (except depreciation) Depreciation Machinery Selling, general, and administrative expenses Income (a) Compute each project's annual net cash flow. (b) Compute payback period for each Investment. Required A Required B Compute each project's annual net cash flow. Complete this question by entering your answers in the tabs below. Annual Amounts Sales of new product Expenses Materials, labor, and overhead (except depreciation) Depreciation-Machinery Selling, general, and administrative expenses Income Net cash flow $ S Income Project 1 144,000 76,000 31,000 19.000 18,000 Project 1 $ 144,000 S 76,000 31,000 19,000 $ 18,000 Cash Flow 0 S S Required B > Project 2 $ 124,000 43,000 29,000 31,000 $ 21,000 Project 2 Cash Flow Income 124,000 43,000 29,000 31,000 21,000 S 0
Information for two alternative projects involving machinery Investments follows. Project 1 requires an initial Investment of $245,000. Project 2 requires an Initial Investment of $175,000. Annual Amounts Sales of new product Expenses Materials, labor, and overhead (except depreciation) Depreciation Machinery Selling, general, and administrative expenses Income (a) Compute each project's annual net cash flow. (b) Compute payback period for each Investment. Required A Required B Compute each project's annual net cash flow. Complete this question by entering your answers in the tabs below. Annual Amounts Sales of new product Expenses Materials, labor, and overhead (except depreciation) Depreciation-Machinery Selling, general, and administrative expenses Income Net cash flow $ S Income Project 1 144,000 76,000 31,000 19.000 18,000 Project 1 $ 144,000 S 76,000 31,000 19,000 $ 18,000 Cash Flow 0 S S Required B > Project 2 $ 124,000 43,000 29,000 31,000 $ 21,000 Project 2 Cash Flow Income 124,000 43,000 29,000 31,000 21,000 S 0
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter12: Capital Investment Analysis
Section: Chapter Questions
Problem 1MAD: San Lucas Corporation is considering investment in robotic machinery based upon the following...
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