Two alternative machines (A and B) have been suggested each costing 4,50,000. CashQuestion. 2. The XYZ Co. Ltd. is considering the purchase of a new machine.Flow After Tax (CFAT) are expected to be as follows :Cash Flow After TaxYearMachine A (7)Machine B (7)140,0001,20,0001,20,0001,60,0001,60,0002,00,00042,40,0001,20,0001,60,00080,000The company has a target of return on capital of 10 percent and on this basisyou are required to compare the profitability of the machines and state which alternativeyou consider financially perferable.23

The net рresent vаlue (NРV) is the differenсe between the рresent vаlue оf саsh inflоws…

Two alternative machines (A and B) have been suggested each costing 4,50,000. C. Flow After Tax (CFAT) are expected to be as follows : Cash Flow After Tax Year Machine A () Machine B () 1 40,000 1,20,000 1,20,000 1,60,000 3 1,60,000 2,00,000 100 0 0

Two alternative machines (A and B) have been suggested each costing 4,50,000. C. Flow After Tax (CFAT) are expected to be as follows : Cash Flow After Tax Year Machine A () Machine B () 1 40,000 1,20,000 1,20,000 1,60,000 3 1,60,000 2,00,000 100 0 0

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter11: Capital Budgeting Decisions

Section: Chapter Questions

Problem 18EA: Consolidated Aluminum is considering the purchase of a new machine that will cost $308,000 and...

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Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.

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