Cash payback period, net present value analysis, and qualitative considerations The plant manager of Orlando Electronics Company is considering the purchase of new automated assembly equipment. The new equipment will cost $201,000. The manager believes that the new investment will result im direct labor savings of $67,000 per year for 10 years. Present Value of an Annuity of $1 at Compound Interest Year 6% 10% 12% 15% 20% 0.870 1.626 2.283 1 2 3 4 0.943 1.833 2.673 3.465 0.909 0.893 1.736 1.690 2.402 3.037 2.487 3.170 1 2.855 0.833 1.528 2.106 2.589
Cash payback period, net present value analysis, and qualitative considerations The plant manager of Orlando Electronics Company is considering the purchase of new automated assembly equipment. The new equipment will cost $201,000. The manager believes that the new investment will result im direct labor savings of $67,000 per year for 10 years. Present Value of an Annuity of $1 at Compound Interest Year 6% 10% 12% 15% 20% 0.870 1.626 2.283 1 2 3 4 0.943 1.833 2.673 3.465 0.909 0.893 1.736 1.690 2.402 3.037 2.487 3.170 1 2.855 0.833 1.528 2.106 2.589
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter12: Capital Investment Analysis
Section: Chapter Questions
Problem 15E
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