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Determine Cash Flows Marigold Inc. is planning to invest in new manufacturing equipment to make a new garden tool. The garden tool is expected to generate additional annual sales of 7,900 units at $34 each. The new manufacturing equipment will cost $111,200 and is expected to have a 10-year life and $8,500 residual value. Selling expenses related to the new product are expected to be 5% of sales revenue. The cost to manufacture the product includes the following on a per- unit basis: Direct labor Direct materials $5.80 18.90 Fixed factory overhead-depreciation 1.30 Variable factory overhead 2.90 Total $28.90 Determine the net cash flows for the first year of the project, Years 2-9, and for the last year of the project. Use a minus sign to indicate cash outflows. Do not round your intermediate calculations but, if required, round your final answer to the nearest dollar. Marigold Inc. Net Cash Flows Determine the net cash flows for the first year of the project, Years 2-9, and for the last year of the project. Use a minus sign to indicate cash outflows. Do not round your intermediate calculations but, if required, round your final answer to the nearest dollar. Marigold Inc. Net Cash Flows Initial investment $ Operating cash flows: Annual revenues Selling expenses Cost to manufacture Net operating cash flows $ Total for Year 1 Total for Years 2-9 Residual value Total for last year Year 1 Years 2-9 Last Year

Determine Cash Flows Marigold Inc. is planning to invest in new manufacturing equipment to make a new garden tool. The garden tool is expected to generate additional annual sales of 7,900 units at $34 each. The new manufacturing equipment will cost $111,200 and is expected to have a 10-year life and $8,500 residual value. Selling expenses related to the new product are expected to be 5% of sales revenue. The cost to manufacture the product includes the following on a per- unit basis: Direct labor Direct materials $5.80 18.90 Fixed factory overhead-depreciation 1.30 Variable factory overhead 2.90 Total $28.90 Determine the net cash flows for the first year of the project, Years 2-9, and for the last year of the project. Use a minus sign to indicate cash outflows. Do not round your intermediate calculations but, if required, round your final answer to the nearest dollar. Marigold Inc. Net Cash Flows Determine the net cash flows for the first year of the project, Years 2-9, and for the last year of the project. Use a minus sign to indicate cash outflows. Do not round your intermediate calculations but, if required, round your final answer to the nearest dollar. Marigold Inc. Net Cash Flows Initial investment $ Operating cash flows: Annual revenues Selling expenses Cost to manufacture Net operating cash flows $ Total for Year 1 Total for Years 2-9 Residual value Total for last year Year 1 Years 2-9 Last Year

Managerial Accounting
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 4E: Determine cash flows Natural Foods Inc. is planning to invest in new manufacturing equipment to make...
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Determine Cash Flows Marigold Inc. is planning to invest in new manufacturing equipment to make a new garden tool. The garden tool is expected to generate additional annual sales of 7,900 units at $34 each. The new manufacturing equipment will cost $111,200 and is expected to have a 10-year life and $8,500 residual value. Selling expenses related to the new product are expected to be 5% of sales revenue. The cost to manufacture the product includes the following on a per- unit basis: Direct labor Direct materials $5.80 18.90 Fixed factory overhead-depreciation 1.30 Variable factory overhead 2.90 Total $28.90 Determine the net cash flows for the first year of the project, Years 2-9, and for the last year of the project. Use a minus sign to indicate cash outflows. Do not round your intermediate calculations but, if required, round your final answer to the nearest dollar. Marigold Inc. Net Cash Flows
Transcribed Image Text:Determine Cash Flows Marigold Inc. is planning to invest in new manufacturing equipment to make a new garden tool. The garden tool is expected to generate additional annual sales of 7,900 units at $34 each. The new manufacturing equipment will cost $111,200 and is expected to have a 10-year life and $8,500 residual value. Selling expenses related to the new product are expected to be 5% of sales revenue. The cost to manufacture the product includes the following on a per- unit basis: Direct labor Direct materials $5.80 18.90 Fixed factory overhead-depreciation 1.30 Variable factory overhead 2.90 Total $28.90 Determine the net cash flows for the first year of the project, Years 2-9, and for the last year of the project. Use a minus sign to indicate cash outflows. Do not round your intermediate calculations but, if required, round your final answer to the nearest dollar. Marigold Inc. Net Cash Flows
Determine the net cash flows for the first year of the project, Years 2-9, and for the last year of the project. Use a minus sign to indicate cash outflows. Do not round your intermediate calculations but, if required, round your final answer to the nearest dollar. Marigold Inc. Net Cash Flows Initial investment $ Operating cash flows: Annual revenues Selling expenses Cost to manufacture Net operating cash flows $ Total for Year 1 Total for Years 2-9 Residual value Total for last year Year 1 Years 2-9 Last Year
Transcribed Image Text:Determine the net cash flows for the first year of the project, Years 2-9, and for the last year of the project. Use a minus sign to indicate cash outflows. Do not round your intermediate calculations but, if required, round your final answer to the nearest dollar. Marigold Inc. Net Cash Flows Initial investment $ Operating cash flows: Annual revenues Selling expenses Cost to manufacture Net operating cash flows $ Total for Year 1 Total for Years 2-9 Residual value Total for last year Year 1 Years 2-9 Last Year
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