4. Machine A costs $800, requires annual maintenance of $150, and will last for 10 years. Machine B costs $600, requires annual maintenance of $200, and will last for 5 years. What is the calculated present worth of machine B if the alternative will be chosen based on a present worth analysis and the required return is 10%? A. $843.31 B. $1,358.16 C. $1,721.69 D. $2,201.47 E. $2,716.47
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- Mason, Inc., is considering the purchase of a patent that has a cost of $85000 and an estimated revenue producing lite of 4 years. Mason has a required rate of return that is 12% and a cost of capital of 11%. The patent is expected to generate the following amounts of annual income and cash flows: A. What is the NPV of the investment? B. What happens if the required rate of return increases?2. It is rëquired to select one of the three machines. Which machine should be selected, based on the present worth comparison at an interest rate of 12% per year, if the costs are shown below? Туре X 7,650 1,200 Туре Y 12,900 900 2,000 Туре Z 17,000 750 First cost, $ Maintenance cost,.( $ lyear) Salvage value, ( $) Economic (years) 4,000 12 4A machine cost is 3000$ and salvage value 850$, if the rate of interest is 9% and number of years are 5 then what willI be the present worth for fixed output condition? Select one: a. 2448$ b. 2418$ c. 2427$
- A project is estimated to cost P120T, last 8 years & have a salvage value of P20T. The annual gross income is expected to average P50k & annual expenses is P5T. If capital is earning 10% determine if this is a desirable investment using annual cost method, what is the net cost. : a. 24,255.598 b. P24,756.951 c. 25,245.598 d. P27,535.4121. Each aiternative has a 10-year useful life and have no salvage value. If the MARR is 8%, which alternative would you select? You must use incremental analysis (incremental internal rate of return). Please show step by step calculations. R Initial Cost 15000 22000 35000 Annual Costs 3500 3100 2750 Annual Revenues 8000 9575 115008. A project has an initial cost of $32,000 and a 3-year life. The projected net income from the project is $1,500, $2,100, and $1,700 a year for the next 3 years, respectively. The company uses straight-line depreciation to a book value of zero over the life of the project. What is the average accounting return? A. 8.72% В. 10.10% С. 11.04% D. 14.69%
- Coronado, Inc. is considering purchasing equipment costing $39000 with a 7-year useful life. The equipment will provide cost savings of $9000 and will be depreciated straight-line over its useful life with no salvage value. Coronado Inc. requires a 11% rate of return. What is the approximate net present value of this investment? Period 7 O $30000 O $4812 O $3408 O $2076 9% 5.033 Present Value of an Annuity of 1 10% 4.868 11% 4.712 12% 4.564 13% 4.423 16% 4.0395) Company is considering about buying an equipment. This equipment needs 100.000 $ initial investment, produces 30.000 $ revenue for 5 years and 10.000 $ salvage value at the end of year 5. a) Find the rate of return (ROR) on this investment. b) What will be the decision If MARR is 15% ?If the cost of the machine is 2000$ , i = 9% for ten year then the present worth will be(p). what is the answer : 1. 2000% 2. 1805$ 3. 1650$
- Alternative X has a first cost of 36000 an annual operating cost of 6900, and a salvage value of 11025 after 13 year. Alternative Y has a first cost of 37000 an annual operating cost of 7000, and a salvage value of 16280 after 13 year. If MARR of 13% per year, approximately what is the PW of each alternative? Select one: O a. PW of X= -77518 and PW of Y= -78067 O b. PW of X= -75990 and PW of Y= -76529 O c. PW of X= -76750 and PW of Y= -77294 O d. PW of X= -78293 and PW of Y= -78848A Mountain Frost is considering a new project with an initial cost of $270,000. The equipment will be depreciated on a straight-line basis to a zero book value over the four-year life of the project. The projected net income for each year is $21,300, $22,200, $24,600, and $18.200, respectively, What is the average accounting return? Multiple Choice O O O C 14.65% 15.00% 11.99% 1712%Compare the following alternatives based on the rate of return analysis assuming that the MAAR is 15% per year. Project A Project B Initial Cost $60.000 $90.000 Annual cost of operation 15.000 8.000 Annual cost of reparation 5.000 2.000 Annual increase of the repair 1.000 1.500 Salvage value 8.000 12.000 Life, years 15 15