(( course : project appraisal ))4.A new project is evaluated at present that involves purchasing a new assembly machine for RO 25,000. Itwill cost RO 2,000 to install the machinery. By making the investment, the annual operating costs will bereduced by RO 7,000 and expect to save RO 500 a year in maintenance.The new machine will require RO750 each year for technical support. The machinery will be subject to depreciation over 5 years under thestraight-line method of depreciation with an expected salvage value of RO 5,000. The effective tax rate is35%. Calculate Relevant Cash Flows for Capital Project.

calculated relevant cash flows for capital project ": Relevant cash Flows During the year will…

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FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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company investment on a machine costing of P40,000 and has a life of 5 years. Yearly cash inflows are as follows: Year 1-P18,000; Year 2-P12,000; Year 3-P10,000; Year 4-P9,000; and Year 5-P6,000. Calculate Net present value at 10% and PI. Will the company accept or reject the project? Complete the table below. 2. A Year Cash flows PV Factor @10% PV 2. 4 Total PV Less-investment Net Present Value PI=
Maintenance cost of an equipment is P20000 for 2 years, P40000 at the end of 4 years and P80000 at the end of 8 years. Compute the semi-annual amount that will be set aside for this equipment. Money worth 10% compounded annually. (Ans: ₱7,426.19)Pls show the given and the solution not excel thanks!
expense of $500. Consider a yearly Two machines are evaluated for a new project, consider a yearly interest rate of 6% and the information described in the following table. Determine EUAC for both alternatives and determine the best option. Purchase cost Salvage value Duration Machine A Machine B $10,000 $15,000 $1,250 $1,950 5 years 10 years 11 13 L
45 At 7.5%, a bridge cost P 200M with a life of 23 years. The bridge must be partially rebuilt at a cost of P 140 M at the end of each 23 years. Calculate the capitalized cost if an annual maintenance of P 590,000 is required. Express your answer in whole number.
SHCJ Research Laboratory requires P3,500,000 for original construction, P500,000at the end of every year for the first 6 years and then P600,000 each year thereafterfor operating and maintenance expenses, and P2,000,000 every 10 years forreplacement of equipment with interest at 12% per annum. Determine thecapitalized cost of the said research laboratory.
Annual maintenance costs of a tunnel considered to have an eternal life are $ 500.is worth. The interest rate is considered to be an average of 5% per year. CapitalizedSince the cost is estimated to be $ 15,000, how much is the initial investment cost of the tunnel?can it? (Answer: $ 5,000)
A machine costs $25,000; it is expected to generate annual cash revenues of $8,000 and annual cash expenses of $2,000 for five years. The required rate of return is 12%. The net present value of the machine is: Select one: a. $(3,840). b. $(3,370). c. $0. d. $21,630. e. $28,840.
A bridge that was constructed at a cost of P 75,000 is expected to last 30 years, at the end of which time its renewal cost will be P 40,000. Annual repairs and maintenance are P 3,000. What is the capitalized cost of the bridge at an interest of 6%? 133,433.00 50,000.00 125,000.00 140,625.00 75,948.67 58,433.00
A research laboratory which requires P5M for original construction; P100T at the end of every year for the first 6 years and then P120T each year thereafter for operating expenses, and P500T every 5 years for replacement of equipment with interest at 12% per annum. What is the cost of perpetual operation? a. P917,740 b. P977,140 c. P719,740 d. P717,940
E2
₱50000 is invested in a machine, in which it has an annual total cost of ₱3000 and a salvage value of ₱4000 at the end of 10 years. Find the equivalent uniform annual cost of this cycle. Money is worth 6%
A machine has a first cost of P45000 with an interest rate of 10% annually. Expected salvage value after 8 years is P8000. Find the book value after 5 years using sinking fund method.

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ave RO 500 a year in maintenance.The nev