BBCanning Machine2Monster Beverage is considering purchasing a new canning machine.This machine costs $3,500,000 up front.Required return = 12.0%YearCash Flow0$-3,500,0001$1,000,0002$1,200,0003$1,300,0004$900,000What is the value of Year 3 cash flow discountedto the present?5$1,000,000Enter a response then click Submit below$0Submit

To determine the value of Year 3 cash flow discounted to the present, we will use the Present Value…

Answered: B B Canning Machine 2 Monster Beverage…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter11: Capital Budgeting Decisions

Section: Chapter Questions

Problem 1PA: Your company is planning to purchase a new log splitter for is lawn and garden business. The new...

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A bookstore is planning to purchase an automated inventory/remote marketing system, which includes an upgrade to a more sophisticated cash register system. The package has an initial investment cost of $360,000. It is expected to generate $144,000 of annual cash flows, reduce costs and provide incremental cash revenues of $326,000, and incur incremental cash expenses of $200,000 annually. What is the payback period and accounting rate of return (ARR)?
monster beverage is considering purchasing a new canon machine this machine cost $3,500,000 up front. required return =10.7%. cash FLow year 0 -3,500,000 first year $1 million dollars second year 1,200,000 3.1,200,000 year three 1,300,000 4. 900,000 fifth year 1,000,000 . what is the value of year 3 cash flow discounted to the present?
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The Pan American Bottling Company is considering the purchase of a new machine that would increase the speed of bottling and save money. The net cost of this machine is $57,000. The annual cash flows have the following projections. Use Appendix B and Appendix D for an approximate answer but calculate your final answer using the formula and financial calculator methods. Year 1 2 3 4 5 Cash Flow $ 22,000 24,000 26,000 32,000 14,000 a. If the cost of capital is 11 percent, what is the net present value of selecting a new machine? Note: Do not round intermediate calculations and round your final answer to 2 decimal places. Net present value b. What is the internal rate of return? Note: Do not round intermediate calculations, Enter your answer as a percent rounded to 2 decimal places. Intemal rate of return %
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The Pan American Bottling Company is considering the purchase of a new machine that would increase the speed of bottling and save money. The net cost of this machine is $69,000. The annual cash flows have the following projections. Use Appendix B and Appendix D for an approximate answer but calculate your final answer using the formula and financial calculator methods. Year 1 2 3 4 5 Cash Flow $ 29,000 29,000 29,000 34,000 20,000 a. If the cost of capital is 13 percent, what is the net present value of selecting a new machine? Note: Do not round intermediate calculations and round your final answer to 2 decimal places. Net present value b. What is the internal rate of return? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Internal rate of return c. Should the project be accepted? O Yes O No %
Hint: this is the sum of each future year's discounted cash flows. What is the present value of all future cash flows? Note: do not include value of Year 0 cash flow. Monster Beverage is considering purchasing a new canning machine. This machine costs $3,500,000 up front. Required return = 11.6% Year Cash Flow Discounted Cash Flow 0 $-3,500,000 $-3,500,000 1 $1,000,000 $896,057 2 $1,200,000 $963,503 3 $1,300,000 $935,300 4 $900,000 $580,211 5 $1,000,000 $577,669
JS er st un gs Sunland, Inc. management is considering purchasing a new machine at a cost of $4,370,000. They expect this equipment to produce cash flows of $791,390, $796,950, $866,730, $1,116,300, $1,212,360, and $1,300,900 over the next six years. If the appropriate discount rate is 15 percent, what is the NPV of this investment? (Enter negative amounts using negative sign e.g. -45.25. Do not round discount factors. Round other intermediate calculations and final answer to 0 decimal places, e.g. 1,525.) The NPV is tA $
First Choice Carpets is considering purchasing new weaving equipment costing $730,000. The company's management has estimated that the equipment will generate cash inflows as follows: Year 1 $204,000 2 $204,000 3 $266,000 4 $266,000 5 $150,000 Considering the residual value is zero, calculate the payback period. (Round your answer to two decimal places.) A. 3.70 years B. 4.61 years C. 3.42 years D. 3.21 years
Q5
The Pan American Bottling Co. is considering the purchase of a new machine that would increase the speed of bottling and save money. The net cost of this machine is $60,000. The annual cash flows have the following projections. Use Appendix B and Appendix D for an approximate answer but calculate your final answer using the formula and financial calculator methods. Year Cash Flow 1 $ 23,000 2 26,000 3 29,000 4 15,000 5 8,000 a. If the cost of capital is 13 percent, what is the net present value of selecting a new machine? b. What is the internal rate of return?

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