Determine the minimum trade in value that the manufacturer should receive and still obtain the new machine if: a machine purchased five years ago has annual operating expenses of $15, 000 and is expected to have a useful life of seven more years with salvage value of $6,800; a machine with equal production, costs $45, 000 with annual operating expense of $10,200, a life thirteen years and salvage of $8,300. The manufacturer expects 23% rate of return.
Q: business purchases 3 new press machines for $150,000 each or a total of $450,000. It borrows…
A: Total cost of assets purchased to the loan taken for assets would give the loan to value ratio.
Q: Debt crisis and solutions?
A: To run the business, corporations have to borrow the funds which will be repaid later with…
Q: Q6. You plan to deposit P100 into a savings account at the end of each month for the next 5 years.…
A: The accumulated amount after 5 years can be calculated with the help of future value of annuity…
Q: 10. Calculate the property tax rate required to meet the budgetary demands of the community. Note:…
A: The tax paid on the sale and purchase of property is known as property tax. It is levied and…
Q: For this investment, an initial amount of $25,000 should be paid this year (t=0). As of next year…
A: The present value method is a method of finding the productivity of the project by discounting the…
Q: 18. The average monthly budget for Camille and Zohan is shown. Camille Zohan INCOME (S) 4100 3900…
A: Solution:- Variable expenses are the expenses which vary according to the use, while fixed expenses…
Q: If the cost of capital is 14%, calculate the net present value (NPV) and indicate whether to…
A: Net Present Value: It is a metric used in capital budgeting to determine the profitability of a…
Q: How emergence or evolution of entrepreneurship took plate? Please explain in Detail.
A: Today, entrepreneurs are paving the way for success as entrepreneurs. They find opportunities, lead…
Q: You expect to receive the following: $4,398 at the end of each year for 12 years $22,256 today…
A: The present value of future cash flow will be the value today without interest and also considering…
Q: A. (CHAPTER 6) Suppose there are two islands. The total population on the two islands is 800 people.…
A: The actual worth of an item, also known as its relative price, is its nominal value modified for…
Q: a hypothetical financial instrument pays 10% annual interest permanently. It pays interest at the…
A: Here, Annual interest rate = 10% YTM = 12% monthly To Find: Part a. Macaulay duration =? Part b.…
Q: You take out a consumer loan at your credit union for new insulated windows for your house. The…
A: A stream of equal cash flows paid or received periodically is termed as annuity. Annuity is either…
Q: Manjean is making car payments of $662 per month for the next 3 years. Manjean knows that the car…
A: Formula Car price = P*[1-(1+I)-N]/I Where P - Monthly payment i.e. $662 I - Monthly interest rate…
Q: . The Central Bank of the Bahamas pegs the Bahamian Dollar to the United States Dollar at a price of…
A: Given, The information regarding the Central Bank of the Bahamas pegs the Bahamian $ to the United…
Q: Ten years ago, Valerie decided to start putting $50 into an account every week. If the account earns…
A: Given, Amount of deposit is $50 Rate is 3.45% compounded weekly Number of years is 10
Q: A new oven wil save s00 per year in electricity expense. How much can we aford to pay for ths oven…
A: Here, Annual savings = $90 Time period = 13 years Interest rate = 16% To Find: Affordable amount of…
Q: end of the 10 year period? 3)An annuity is created by depositing $4,500 at the end of each quarter…
A: Future Value of Annuity: It represents the future worth of the present stream of cash flows. It can…
Q: Q2. Deposits are to be made to an account as indicated in the table below which bears interest at…
A:
Q: On April 1, 2020, Boston Company issued at 99 plus accrued interest 2,000 of 8% P1,000 face value…
A: A bond is said to be issued at discount when its price is less than its face value. On the other…
Q: Find the nominal annual rate of interest for the following investment. Principal $1848.00 Future…
A: Future value ( compound Interest) = P1+rmmt here, P = Principal…
Q: Modigliani & Miller show that dividend policy can also be considered irrelevant. Yet, unexpected…
A: Dividends: Dividends are cash flows that a company pays its common stockholders. Unlike preferred…
Q: A cotton buyer will be making a purchase of 245,000 pounds of cotton on March 1. The buyer…
A: Futures are used for hedging the cash market so that if prices rises than some loss may be prevented…
Q: Homework . Unanswered You and your partner have now found a home for $170,000 in Boone, IA. It…
A: Cost of new home = $170,000 Down payment = 20% Down payment in $ = Cost*Down payment ratio…
Q: FRANCORP is preparing budgets for the quarter ending March 31. Budgeted sales for the next 5 months…
A: Financial budgets ae prepared by corporate entities for making financial plans and policies for the…
Q: The current ratio of a company is 6:1 and its acid-test ratio is 1:1. If the inventories and prepaid…
A: Current Liabilities: These are liabilities that are due in less than a year and are expected to pay…
Q: Lead time usage refers to the length of period it takes to order and receive goods and also called…
A: The above Statement is 'True'.
Q: 1. In broad terms, why is some risk diversifiable? Why are some risks nondiversifiable? Does it…
A: Unsystematic risk is a risk that is distinctive to a particular firm or industry. Nonsystematic risk…
Q: Term policies provide a O death benefit and a savings component. O death benefit only. O savings…
A: “Hi There, Thanks for posting the questions. As per our Q&A guidelines, must be answered only…
Q: A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a…
A: Here,
Q: %-
A: The return on bonds earned by the investors till maturity is known as yield to maturity. The return…
Q: Q5. At 5% annual interest, what is the difference in the present and future value of P100 paid at…
A: Given, Payment is P100 Rate is 5% Term is 10 years
Q: A company has a 13% WACC and is considering two mutually exclusive investments (that cannot be…
A: Here, Note: We are solving Part d to g as mentioned in the question.
Q: Q2. Carlos and Martha wanted to ensure that they had $100,000 for their child's future plans. As…
A: Effective annual rate: Because compounding effects are taken into account, the effective annual…
Q: Question 18 Hamilton Company invested in a two-year project having an internal rate of return of…
A: Solution:- We know, Internal Rate of Return (IRR) is the rate of return the project is yielding ie.…
Q: TIPS FOR READING AN EXCHANGE RATE CHART: Read down the chart. For example, in column 1 it says the…
A: Depreciation of a currency means that the value of the currency with respect to the other decreases,…
Q: Stretching payables refers to postponing payment of bills to their due dates or last date of…
A: The Cash Conversion Cycle (CCC) is one of the various quantitative indicators that may be used to…
Q: Styles Ms. Rahat hails from a business family. She is considering starting a supermarket with an…
A: " Hi, Thanks for the question. Since you asked multiple sub parts question, we will answer first…
Q: homas deposited 300,000Php now, so that his 3 year old daughter will receive 6 equal amounts of ey…
A: The money grow with time and interest rate so if proper deposits are made at proper timing than this…
Q: payment on a house. If you can invest your money at 3.25% compounded month, what payment would have…
A: Future Value of Annuity: It is the future value of the present cash flow stream and is estimated by…
Q: common shareholders of BFG inc. received the following dividends (per share) in recent years: $0.10…
A:
Q: Suppose you purchase a 30-year, zero-coupon bond with a yield to maturity of 5.7%. You hold the bond…
A: Annualized Rate of Return: It represents the equivalent annual return on investment for a certain…
Q: 2. What is the future worth of P600 deposited at the end of every quarter for 4 years if the…
A: The value of an asset at a specific date is referred to as its future value. It is the present value…
Q: In Munich, a hotdog costs €9 and in Boston a hot dog costs $1. If the exchange rate is $1.35/Euro.…
A: Cost per Munich hotdog = €9 Cost per US hotdog = $1 Exchange rate €1 = $1.35
Q: Can someone elaborate the step by step solution on this? I am somehow uncertain about the step by…
A: Future Value F is 270 Present Value P is 250 Time period is 90 days Number of days in a year are 360…
Q: d new delivery truck was bought PHP 420,000 down payment and monthly instalment of PHP 10,000 at the…
A: Loans are paid by the down payment and monthly payments that carry the payment of interest and…
Q: Benjamin Garcia’s start-up business is succeeding, but he needs $200,000 in additional funding to…
A: The fair price will depend upon the current value of the company and number of shares. The…
Q: Both projects aim to units in the first year, 6,500 units in the second and third years and a…
A: “Since you have posted a question with multiple sub-parts, we will solve first three subparts for…
Q: J&R Renovation, Inc., is trying to determine its cost of debt. The firm has a debt issue outstanding…
A: a) Pre Tax cost of debt: Interest rate found out using Financial Calculator N = 14 * 2 = 28 PMT =…
Q: in CengageNOWv2| Online teachi x Cengage Learning 8-1 Problem Set: Module Eight X…
A: Cash flow from operating activities consists of cash inflows and cash outflows from day to day…
Q: Suppose you bought a sofa for a total purchase price of $1,184.97. State taxes were 4%. What was the…
A: Tax is referred as the compulsory financial charge, which are imposed by the government on the…
Determine the minimum trade in value that the manufacturer should receive and still
obtain the new machine if: a machine purchased five years ago has annual operating
expenses of $15, 000 and is expected to have a useful life of seven more years with
salvage value of $6,800; a machine with equal production, costs $45, 000 with annual
operating expense of $10,200, a life thirteen years and salvage of $8,300. The
manufacturer expects 23% rate of return.
Step by step
Solved in 2 steps
- A new machine can be purchased for $50,000. Its expected useful life is seven years, with a salvage value of $5,000. Annual revenues will be $22,000 per year and annual expenses will be 8,000 per year, over the seven-year study period. If the MARR is 10%, determine whether the offer should e accepted. O a. Acceptable and its AW = $4257 O b. Not acceptable and its AW = $2,345 O. Acceptable, and its AW = $5067 O d. Not acceptable and its AW = -$3,281A new robot has a first cost of $380,000, and an annual operating cost of $88,000 in years 1 and 2, increasing by $10000 per year thereafter. The salvage value of the system is $25,000 regardless of when the system is retired within its maximum useful life of 5 years. Using a MARR of 14% per year, determine the ESL and the respective AW value of the system ESL: a) 1 year b) 4 years c) 5 years d) 3 years AW value of system: a) $204,860 b) $336,284 c) $97,953 d) $496,200Calculate the present worth of all costs for a newly acquired machine with an initial cost of $24,000, no trade-in value, a life of 11 years, and an annual operating cost of $14,000 for the first 6 years, increasing by 10% per year thereafter. Use an interest rate of 10% per year. The present worth of all costs for a newly acquired machine is determined to be $
- An engineer with Haliburton calculated the AW values shown for retaining a presently owned machine additional years. A challenger has an economic service life of 7 years with AW = $-86,000 per year. Assuming all future costsremain as estimated for the analysis, (a) when should the company replace the defender and with what machine, and (b) when should the companypurchase the challenger? The MARR is 12% per year. Assume used machines like the one presently owned will always be available.A company is considering two alternatives with regards to equipment which it needs. The alternatives are as follows: Alternative A: Purchase Cost of Equipment 703,668700,000 Salvage Value 100,454100,000 Daily operating cost 501500 Economic life, years 10 Alternative B: Rental at 1,5751,500 per day. At 18% interest, how many days per year must the equipment be in use if Alternative A is to be chosen.What is the decision criteria for Payback Period (PBP) method? A construction company is considering the purchase of a new piece of equipment. Relevant information concerning the equipment follows: Cost of the equipment $220,000 Annual cost savings from new equipment $44,000 Life of the new equipment 10 years Compute the payback period for the equipment. If the company requires a payback period of five years or less, would the equipment be purchased?
- An investment of P135 000.00 is being considered for a new lathe machine. Estimated economic life of the lathe is 12 years with a salvage value of P10 000.00. Projected annual income and expenses for the investment are P80 000.00 and P30 000.00, respectively. Using an MARR of 15% compounded annually and applying PW analysis, determine if the lathe should be purchased. (Ans. Purchase is justified, P137 900.00)Consider palletizer at a bottling plant that has a first cost of $134,338, has operating and maintenance costs of $17.980 per year, and an estimated net salvage value of $37,509 at the end of 30 years. Assume an interest rate of 8%. What is the future worth of this project? Enter your answer as follow: 123456.78An injection molding system has a first cost of $200,000 and an annual operating cost of $69,000 in years 1 and 2, increasing by $5,500 per year thereafter. The salvage value of the system is 25% of the first cost regardless of when the system is retired within its maximum useful life of 5 years. Using a MARR of 11% per year, determine the ESL and the respective AW value of the system. The ESL is ]year(s) and AW value of the system is $|
- Calculate the equal, end-of-period, annual cost of a machine which costs $75000 initially and will have a $17000 salvage value after 11 years. The operating cost is $9000 at the end of year1 and amounts increasing by 8% each year. Use an interest rate of 10% per year.An injection molding system has a first cost of $175,000 and an annual operating cost of $95,000 inyears 1 and 2, increasing by $6,000 per year thereafter.The salvage value of the system is 25% ofthe first cost regardless of when the system is retired within its maximum useful life of 5 years.Using a MARR of11% per year, determine the ESL and the respective AW value of the system.You have been asked to evaluate two alternatives, X and Y, that may increase plant capacity for manufacturing high-pressure hydraulic hoses. The parameters associated with each alternative have been estimated. Which one should be selected on the basis of a present worth comparison at an interest rate of 13% per year? Why is yours the correct choice? Alternative First Cost X $-45,000 Maintenance cost, per $-9000 Year Salvage Value $1,000 Life 5 years Y $-55,000 $-4000 $6,500 5 years The present worth of alternative X is $ 13888 and that of alternative Y is $ 44459.4 Alternative X is selected by the company.