and what will be the cost per unit.
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A company manufactures iron cutting machines. The investment amount made for the machine is 800 thousand TL. Energy costs will increase by 50 thousand and 6% each year. Personnel expenses will increase by 35 thousand and 15 thousand each year, on the other hand, financial expenses will increase by 100 thousand TL and 20% each year. Since it is planned that 250 machines will be manufactured annually, the company has to charge a total cost of TL to the machines manufactured each year for this production with a 12-year life and 30% capital cost, and what will be the cost per unit.
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- Everest Dew Corporation is planning to construct a new manufacturing plant on which has 60 production lines to run at any point of time to make output. The usage of the line is expected to be 92% all time throughout the years. The initial investment cost for all the lines is RM950,000. It is expected to generate revenue RM8,200 per line in year 1 and 10% increase for every year from year 2 to 6. The operating cost per line is RM1,200 and expected to increase by 10% every year from year 2 to 6. At year 6 it can cease the operation by selling the entire business for RM420,000. The cost of capital is expected to be about 12%. Advice whether the project is acceptable or rejected by using the below methods. A. Accounting Rate of Return (AROR) B. Payback Period Technique (PBP) C. Discounted Payback Period (DPP) D. Net Present Value Technique (NPV) E. Profitability Index (PI) F. What is the importance of the Technique used for analysis on Capital budgeting cost for a project?Acme Inc. has invested $50,000 in a new assembly line. Products produced by the new assembly line are sold for $100 per unit. Fixed annual costs are $10,000 while variable annual costs are $10 per unit. The assembly line will remain in operation for 10 years, after which it will be sold for $15,000. The company has a MARR of 15%. What is the minimum annual production volume required to generate a profit?The Engineers in a certain company are considering introducing a new product line. The initial investment required for this project is 250,000 OMR and the annual maintenance costs are expected to be 14,500 OMR. Annual operating costs will be directly proportional to the level of production at 11 OMR per unit, and each unit of product can be sold for 45 OMR. The estimated production output is 3000 unit per year. The MARR is 12% per year and the project has a life of 6 years. The initial investment, maintenance costs and production output are estimated to be within ±30%. Is this project acceptable from profitability point of view (show your analysis)? Analyze the sensitivity of AW to changes in each estimate individually (i.e.: make a spider plot). Based on your results rank these input factors from the highest sensitivity to the lowest. Calculate the breakeven deviations for the estimates and make recommendation either to accept or reject this project.
- For a new punch press. Company A charges $250,000 to deliver and install it. Company A has estimated that the machine will have operating and maintenance (O & M) costs of $4000 a year. You estimate an annual benefit of $89,000. Company B charges $205,000 to deliver and install the device. Company B has estimated O & M of the press at $4300 a year. You estimate an annual benefit of $86,000. Both machines will last 5 years and can be sold for $15,000. Use an interest rate of 12%. Which machine should your company buy?The textile factory is being upgraded. The expectation is that labor costs will decrease at an annual rate of 5% while overhead costs will increase at 8%. Now by the end of the first year the Labor costs $2million Material costs $3 million Overhead costs 1.6 million The time value of money rate is 11% and the time horizon is 7 years. Determine the dollar value for each cost category (labor, material, overhead) for each year and the total cost for each year. Determine the present worth of each cost category and the total cost. Determine the annual worth over 7 years that is equivalent to the present worth of the total cost.Jax Inc is considering the purchase of a new machine for the production of computers. Machine A costs $7,000,000 and will last for six years. Variable costs are 25% of sales, and fixed costs are $500,000 annually. Machine B costs $10,000,000 and will last for ten years. Variable costs for the machine are 15% of sales, and fixed costs are $750,000 annually. The sales for each machine will be $4,000,000 per year. The required rate of return is 9%, the tax rate is 21%, and both machines will be depreciated using straight-line depreciation with no salvage value. Calculate the equivalent annual annuity for Machine A. (Round to 2 decimals)
- Jax Inc is considering the purchase of a new machine for the production of computers. Machine A costs $7,000,000 and will last for six years. Variable costs are 25% of sales, and fixed costs are $500,000 annually. Machine B costs $10,000,000 and will last for ten years. Variable costs for the machine are 15% of sales, and fixed costs are $750,000 annually. The sales for each machine will be $4,000,000 per year. The required rate of return is 9%, the tax rate is 21%, and both machines will be depreciated using straight-line depreciation with no salvage value. Calculate the equivalent annual annuity for Machine A. (Round to 2 decimals) Show how this is done in excel. Please answer fast i give you upvote.Jax Inc is considering the purchase of a new machine for the production of computers. Machine A costs $7,000,000 and will last for six years. Variable costs are 25% of sales, and fixed costs are $500,000 annually. Machine B costs $10,000,000 and will last for ten years. Variable costs for the machine are 15% of sales, and fixed costs are $750,000 annually. The sales for each machine will be $4,000,000 per year. The required rate of return is 9%, the tax rate is 21%, and both machines will be depreciated using straight-line depreciation with no salvage value. Calculate the equivalent annual annuity for Machine B. (Round to 2 decimals) What is the Net Present Value for Machine B? (round to 2 decimals)Tool Makers, Inc. uses tool and die machines to produce equipment for other firms. The initial cost of one customized tool and die machine is $850,000. This machine costs $10,000 a year to operate. Each machine has a life of 3 years before it is replaced. What is the equivalent annual cost of this machine if the required return is 9%? (Round your answer to whole dollars.)
- Nestle Ltd. produces its premium plant food in 50 Kg bags. Demand is 100,000 Kgs. per week and the plant operates 52 weeks each year. Nestle can produce 250,000 Kgs. per week. The setup cost is OMR 200 and the annual holding cost rate is OMR 0.550 per bag. What is the optimal total cycle time including the production time in year?Each year, the company needs atleast 10,000 parts. A supplier has offered to sell a component to the company for ₱54 each. However, if the company choose to outsource the component of the product, it can use the facilities to make another product that would yield a total contribution margin of ₱60,000 per year. The unit cost for making the components is shown below A. How much is the total cost to make the component? B. How much is the total cost to buy the component? C. How much is opportunity cost in the given problem? D. What should be the optimal decision for the company?b. XYZ company produces staplers and other items. The production cost per unit is $8 and the cost of setting up the production line for this is $60. The annual holding cost rate is 30%. The company works 250 days per year. The production rate for this product is 120 per day. If the annual demand is 20,000 units, iii. What is the total production time allocated to this product annually?