3. ABY company purchased a new CNC machine for $100,000. The market value of the new machine in each year is given in the table below. Annual operating and maintenance costs will be $30,000 per year. MARR is 12% per year. a) Calculate the marginal cost of the new CNC machine in years I to 4. (. b) Determine the economic life of new CNC machine. (
Q: 7. Compute for the number of blocks that an ice plant must be able to sell per month to break-even…
A: Hi, thanks for the question. As per the guidelines we are allowed to attempt the first question. If…
Q: Mr. Sanchez, a businessman, is thinking of buying a machine that is expected to be obsolete in 5…
A: *Answer:
Q: 0,000.00 will be retired at the end of 8 years. Depreciation cost is computed using a constant…
A: First Cost=P 60,000.00 Life=8 years Depreciation method: declining book value Annual rate of…
Q: Problem 3: A certain machine costs P 40,000, has a life of 4 years and salvage value of P 5,000. The…
A: In the mentioned question, we have to find the third year book value. Depreciation is calculated…
Q: 1. What is the value of ROR (i*) for the following equation? 0 = -20,000 + (29,000 21,000) (P/A,…
A: Given investment = 20000 Net cashflow = 29000 – 21000 = 8000 Time = 4 years
Q: The following pair of assets differ only in the MARR. The problem asks you to determine the effect…
A: To find the economic life of an asset , we find the annual worth of cumulative operating costs and…
Q: 1) A public agency is obliged to purchase a compressor with an economic life of 10 years or by…
A: In the given question, A Public Agency has to purchase a compressor, for this it has 2 alternatives…
Q: An embroidery machine has an initial cost of P200,000. Its salvage value after 10 years is P20,000.…
A: Initial cost of P200,000 Salvage Value = 20,000 Time period = 10 years
Q: 7-19 MSA Computer Corporation manufactures two models of minicomputers, the Alpha 4 and the Beta 5.…
A:
Q: 7.2 (LG 7.2) Maryhill Mines has a pelletizer that it is considering for replacement. Every three…
A: Introduction:- The pelletizer gadget, which changes over the item into pellets of different shapes…
Q: An aute generate $85,000 of savings for each of the next 6 years. At the end of the 6 years, the…
A: To compute the PW & the IRR we take following steps : # Compute Cash flow which requires…
Q: Certain new machinery used in manufacturing of motor vehicles, when placed in service, is estimated…
A: Present Worth is defined as the method which is used to calculate future cashflows Given, Cost of…
Q: Exercise 5 (Cost of goods manufactured and sold) Compute cost of goods manufactured and cost of…
A: Here we calculate the cost of goods manufactured and cost of goods sold by the following method as…
Q: Compute the number of blocks that an ice plant must be able to sell per month to break-even based on…
A: Given: To Find: The number of blocks that an ice plant must be able to sell per month to…
Q: 8) ROVNO Ltd. just invested $50 000 into a new local network. Services provided by the network will…
A: find the answer below.
Q: 7-10. A crane rental company has acquired a new heavy-duty crane for $300,000. The company…
A: Introduction Depreciation Depreciation in the most simple form is the reduction in the value of the…
Q: A businessman is considering the purchase of a machine that is expected to be obsolete in 5 years.…
A: Given: Cost of machine=P 100,000 Interest rate=15% Income: Year 1=20000, Year 2=25000, Year 3=35000,…
Q: A firm is considering purchasing a machinethat costs $65,000. It will be used for six years, andthe…
A: The recovery rate under the general depreciation system for five year is given in the below table.…
Q: A machine was purchased at an original cost of P400,000 with a salvage value of P20,000. Life of…
A: GIVEN DATA Purchase price = Php 400,000 Salvage value = Php 20,000 Life of machine = 6 years Total…
Q: 3. A machine costing P 100,000 has an estimated scrap value of P 10, 000 at the end of its economic…
A: * SOLUTION :- As per guidelines we write first problem solution only Rest are re-post please.…
Q: A small print shop is investing in new printing equipment that will cost $30,000. They estimate that…
A: Given that :- New printing equipment cost $30,000 Additional revenues for every of the next 6 years…
Q: Bob lives in Toronto and runs a business that sells guitars. In an average year, he receives…
A: Explicit expense is the cash consumption brought about by the entrepreneur on information sources or…
Q: The Alpha Drug Company has just purchased a capsulating machine for ₱ 2,000,000. The plant engineer…
A: GIVEN The Alpha Drug Company has just purchased a capsulating machine for ₱2,000,000. The plant…
Q: A small print shop is investing in new printing equipment that will cost $30,000. They estimate that…
A: Answer; Given that :- A small print shop is investing in new printing equipment that…
Q: Xavier Company contracted for the purchase and installation of a large printer which costs P250,000.…
A: Depreciation is the amount of loss of value of fixed capital over period of time . Machinary cost =…
Q: la. An asset is purchased for $90,000. It is expected to have a useful life of six years and a…
A: Given: The cost of an asset is = $90,000 Useful life = 6 years Salvage value = $18,000 To Find: The…
Q: A factory bought new machinery at a price of $120,000. It cost them an additional $7,000 in shipping…
A: Depreciation and tax bases cost=Price of asset+Shipping and delivery charges+Installation charges
Q: 3. Make an economic analysis to determine which of the following two machines capable of performing…
A: here we calculate the annual worth of the both machine and choose the best machine so , here we…
Q: Company purchases a new punch press at a cost of $265,000. Delivery and installation cost $46,000.…
A: (1) Cost basis = Purchase cost + Delevery and Installation cost…
Q: A procurement engineer bought a large transformer core for Php 250,000. Other expenses including…
A: Total Cost of Transformer = PHP 250,000 + PHP 30,000 = PHP 280000 Salvage value after 15 years = 25%…
Q: A small print shop is investing in new printing equipment that will cost $42,000. They estimate that…
A: Given information Initial investment=42000 Annual revenue=14000 Salvage value=3000 Tax rate=27%…
Q: 2. In 2015 your friend bought a Pear ePhone-X smart phone for $781. Now, in 2021, Sell-My-Stuff says…
A: Linear depreciation function represents the value of an asset in some near future. In this case the…
Q: A process plant making 5000kg /day of a product selling for $1.75 per kg has annual direct…
A: Breakeven point refers to the situation where the total cost of the production is equal the total…
Q: QUESTION 1 A new machine is to be purchased for $200,000. The company believes it will generate…
A: Given that; A new machine is to be purchased for $200,000. It is believed that it will generate…
Q: 10 9 8 7 6 5 4 3 2 1 AS AD Tools -9 QE QF
A: Introduction As measured by output, GDP is neither larger nor lower than GDP as measured by demand.…
Q: 1. Hula hoop fabrications cost $100 each. The H2H company is trying to decide how many of these…
A:
Q: the profit after selling each kg and before taxes is 0.04$. Calculate a- the break-even point as a…
A:
Q: 1. A company considers purchasing a new machine that costs P600,050.00. It is projected that the…
A: Net present value = Present value of benefits - Present value of costs
Q: It is desired to purchase a piece of equipment worth $77,000 that has a useful life of four years…
A: Depreciation is characterized as the decrease of the kept cost of a proper asset in an orderly way…
Q: T has bought the new N2 for 80,000 Knuts and because the broomstick flies only with the wizard who…
A: We are going to find the Annual equivalent cost for the broomstick to answer this question. Interest…
Q: 37. Electronic Games is moving very quickly to introduce a new interrelated set of video games. The…
A: After-tax Cash Flows (ATCF) is a calculation of the net adjusted annual cash profit earned over time…
Q: A project involved initial construction costs of $2.5 million. The annual rate of economic…
A: Meaning of Inflation: Inflation generally arises when there is an excessive increase in the level…
Q: 9. An optical scanning machine was purchased for P150,000 in the current tax year (year one) It is…
A: The MACRS depreciation method allows the business to recover the capitalized cost through obtaining…
Q: A crane rental company has acquired a new heavy-duty crane for $310,000. The company calculates…
A: Given: The purchase amount for the crane is = $310,000 The salvage value for the crane is = $40,000…
Q: This year, FCF Inc, has earnings before interest and taxes of $10,440,000, depreciation expenses of…
A: Introduction Free cash flow will help the company for her operating decisions. When a company…
Q: Compute the salvage value of an equipment if its original cost is P 2 550 000. T economic life of…
A: Given the original cost = 2550000 Economic life = 15 years Annual depreciation = 83000
Answer according to question
Step by step
Solved in 3 steps with 4 images
- A logistics company is budgeting for its fuel usage for the next 4 years. Current fuel costs are $350,000 per year; it believes that fuel costs will rise 6% per year due to inflation over the next four years. Assuming the logistics company uses a a 16% combined return on investment, what would be the present worth of its fuel costs for years 1-4? Click here to access the TVM Factor Table calculator. $ Carry all interim calculations to 5 decimal places and then round your final answer to a whole number. The tolerance is ± $10.Question 31 4) In order to make a replacement decision, a firm calculated the equivalent annual cost of owning an asset as follows: Replacement Period Salvage Value EAC Capital Costs Annual Repair EAC Repair Costs Costs 1 $1420 $1,287 2 $1,102 $1,082 $400 $189 3 $910 $976 S600 $298 4 S795 $812 S800 $437 O a. in 4 years O b. in 3 years Oc.in 1 year O d. in 2 years11:36 00 VOLTE 76% expert.chegg.com/qna/auth Chegg Hide student question Time Left: 01:51:59 A 8 ✓ Student question A machine has a first cost of $24,000. Its market value declines by 20% annually. The repair costs are covered by the warranty in Year 1, and then they increase $900 per year. The firm's MARR is 12%. Find the minimum EUAC for this machine and its economic life. Skip G Exit Σ Q 2 Submit ... Training
- 9. An injection - molding machine has a first cost of $1,050,000 and a salvage value of $225,000 in any year. The maintenance and operating cost is $235,000 with an annual gradient of $75,000. The MARR is 10%. What is the most economic life? (Review Chapter 13)Determine the number of souvenir coins that must be sold per year to justify the purchase of a $6000stamping machine. Each coin will be sold for $5.00 with a variable cost of $1.50. The machine will havelittle or no salvage value at the end of its 4-year useful life. Use an interest rate of 8%. What happens tothe BEP if the variable cost increases to $2 per unit? show complete solution. Use BEP in units2. One year ago, a machine was purchased at a cost of $2,000, to be used for 6 years.However, the machine has failed to perform properly and has a cost of $500 per year forrepairs, adjustments, and shutdowns. A new machine is available to accomplish thefunctions desired and has an initial cost of $3,500. Its maintenance costs are expected tobe $50 per year during its service of 5 years. The approximate market value of the presentmachine has been roughly $1,200. If the operating cost (other than maintenance) for bothmachines are equal, show whether it is economical to purchase the new machine. Performa before-tax study, using an interest rate of 12% and assume that the salvage values will benegligible.
- . A young mechanical engineer is considering establishing his own small company. An investment of P400,000 will be required which will be recovered in 15 years. It is estimated that sales will be P800,000 per year and that operating expenses will be as follows. Materials P160,000 per year Labor P280,000 per year Overhead P40,000 +10% of sales per year Selling expense P60,000 The man will give u his regular job paying P216, 000 per year and devote full time to the operation of the business; this will result in decreasing labor cost by P40,000 per year, material cost by P28,000 per year and overhead cost by P32,000 per year. If the man expects to earn at least 20% of his capital, should he invest?15. A heavy construction company purchased an excavator for $540,000.00. Operating and maintenance costs will be $36,000.00 for the first year and increase by $30,000.00 each year. The first year the firm will have an income of $660,000.00 and the income will decrease by $5,000.00 each year. The salvage value of the excavator will be $150,000.00 in year 10. Calculate the rate of return for the excavator using net present worth analysis. Calculate the rate of return using equivalent uniform annual worth analysis.3. The annual worth method An office supply company has purchased a light duty delivery truck for $15,000. It is anticipated that the purchase of the truck will increase the company’s revenue by $10,000 annually, whereas the associated operating expenses are expected to be $3,000 per year. The truck’s market value is expected to decrease by $2,500 each year it is in service. If the company plans to keep the truck for only 2 years, what is the annual worth of this investment? The MARR = 18% per year
- 3. Make an economic analysis to determine which of the following two machines capable of performing the same task in a given amount of time, should be purchased. The minimum return is 8%. Machine A Machine B First Cost P10,000 6 years P20,000 14 years Estimated Life Salvage Value Annual maintenance P6,000 P300 P250 Basing on annual cost, using straight line method of computing depreciation, determine which machine you would choose and how much is the difference in its annual cost? Hint: Compute the Annual Cost of Machine A and Machine B then compare the costs, get the difference and recommend.Please solve in 30 min i will give you a upvote PROBLEM 2 Karim Inc. calculated the annual cost of owning an asset as follows. EUAC Annual EUAC Replacement Capital Repair Repair Year Costs Costs Costs $1,400 $1,100 1 2 $450 $200 3 $900 $600 $350 4 $800 $800 $400 $700 $1,000 $600 $1,300 $500 $1,600 $450 $600 7 $750 a. When should the company replace the equipment? b. If Karim Inc currently replaces its equipment every year to avoid increasing annual repair costs, how much can the company save annually?New-Project Analysis The Campbell Company is considering adding a robotic paint sprayer to its production line. The sprayer's base price is $830,000, and it would cost another $22,500 to install it. The machine falls into the MACRS 3-year class, and it would be sold after 3 years for $485,000. The MACRS rates for the first three years are 0.3333, 0.4445, and 0.1481. The machine would require an increase in net working capital (inventory) of $17,500. The sprayer would not change revenues, but it is expected to save the firm $351,000 per year in before-tax operating costs, mainly labor. Campbell's marginal tax rate is 25%. (Ignore the half-year convention for the straight-line method.) Cash outflows, if any, should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to the nearest dollar. What is the Year-0 net cash flow? $ What are the net operating cash flows in Years 1, 2, and 3? Year 1: $ Year 2: $ Year 3: $ What…