A steel fabrication company invested $900,000 in a new shearing unit. The company obtains a monthly net income of $25,000. If the company uses a minimum acceptable rate of return of 18% per year, compounded monthly, the equivalent payback period for this investment would be closest to: A. 5 years B. 4 years C. 3 years D. 2 years Formula used:
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- Caduceus Company is considering the purchase of a new piece of factory equipment that will cost $565,000 and will generate $135,000 per year for 5 years. Calculate the IRR for this piece of equipment. For further instructions on internal rate of return In Excel, see Appendix C.A restaurant is considering the purchase of new tables and chairs for their dining room with an initial investment cost of $515,000, and the restaurant expects an annual net cash flow of $103,000 per year. What is the payback period?A certain investment costs $3400. The investment produces income of $1500 at the end of the first year and $2500 at the end of the second year. Find the annual return on the investment.
- Calculate the Simple Payback in years for the following system: The initial capital investment for the robot and all accessories = $44,600.00 The annual labor costs replace by the robot = $18.00/hour Annual expenses for maintaining the robot = $1.50/hour Calculate on 1 eight hour shift with 250 days in the work year. Round your answer to two decimal places..A company purchase a piece of manufacturing equipment for an additional income. The expected income is $4,500 per semester. Its useful ife is 9 years. Expenses are estimated to be $500 semiannually if the purchase price is $44,000 and there is a salvage value of $4,500, what is the prospective rate of return (RR) of this investment? The MARR is 10% compounded semiannually Oa IRR-602% semiannual Oh IRR-3% semiannual ORR-12% semiannual Od IRR-6.23% semiannualAn investment will cost $10,000 today for equipment plus expenses for labor andmaterials at a continuous annual rate of $2,000 per year for the next four years. Theproject will begin earning back money at a continuous rate of $3,000 per year beginningfour years from now and continuing forever. Assuming an annual effective rate i=2%,calculate the discounted payback period.
- A process for producing the mosquito repellant Deet has an initial investment of $200,000 with annual costs of $50,000. Income is expected to be $90,000 per year. (a) What is the payback period at i = 0% per year? A i = 12% per year? (Note: Round your answers to the nearest integer.) (b) What is the annual breakeven production quantity for both payback periods (determined above) if net profit, that is, income minus cost, is $10 per gallon?Yejen Industries Ltd. invested $10,000,000 in manufacturing equipment for producing small wastebaskets. If the company uses an interest rate of 15% per year, the amount of money it will have to earn each year to recover its investment in 7 years is closest to:a. $2,403,600b. $3,530,800c. $3,941,800d. $4,256,3001. A company is planning to start an investment, for which there are 6 alternatives. The company can choose only one of these, in other words: the projects are mutually exclusive. Data given: • All projects have the same useful life, of 6 years. • The (annual nominal, compounded annually) MARR is 10% if the investment is $1,250 or less, 11% if more than $1,250. Table containing the Initial Investment, the Annual net cash flows (constant) and the IRR: 1 2 3 4 5 6 Initial Investment -$1,000 -$750 -$1,500 -$500 -$2,000 -$2,500 Annual net cash flow IRR $225 9% $200 $350 $120 $500 $650 15% 11% 12% 13% 14% What is the best project? a) Apply the incremental investment analysis procedure to the NPV-method
- pd! Required information A process for producing the mosquito repellant Deet has an initial investment of $165,000 with annual costs of $43,000. Income is expected to be $90,000 per year. What is the annual breakeven production quantity for both payback periods if net profit, that is, income minus cost, is $10 per gallon? (Consider the rounded values of years calculated in part a. Also, round your answer to the nearest integer.) When i = 0%, the annual breakeven production quantity is determined to be When i = 12%, the annual breakeven production quantity is determined to be gallons per year. gallons per year.Alpha company invested $10,000,000 in manufacturing equipment for producing small wastebaskets. If the company uses an interest rate of 15% per year, the amount of money it will have to earn each year to recover its investment in 7 years is closest to: Select one: a. $6,403,600 b. $4,403,600 c. $2,403,600 d. $9,403,600