Evergreen Dental Clinic is considering purchasing a new dental X-ray machine to improve its diagnosis process. The machine will cost $75,000. The clinic estimates that it could charge $30.00 for a dental X- ray, while the actual cost of providing an X-ray (including materials, utilities, and technician fees) would be $8.00 per X-ray. What would be the profit if Evergreen Dental Clinic were to perform 4,000 dental X-rays?
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- Want answerI'm waiting for answerQuestion: Doctor J. is considering purchasing a new blood analysis machine to test for leukemia; it will cost $60,000. He estimates that he could charge $25.00 for an office visit to have a patient's blood analyzed, while the actual cost of a blood analysis would be $5.00. What would be his profit if he were to perform 5,000 leukemia blood analyses?
- The Atlantic Medical Clinic can purchase a new computer system that will save $6,000 annually in billing costs. The computer system will last for six years and have no salvage value. Required: What is the maximum price (i.e., the price that exactly equals the present value of the annual savings in billing costs) that the Atlantic Medical Clinic should be willing to pay for the new computer system if the clinic's required rate of return is: (Round your final answer to the nearest whole dollar amount.) Maximum Price 1. Nine percent 2. Fourteen percentThe Atlantic Medical Clinic can purchase a new computer system that will save $7,000 annually in billing costs. The computer system will last for nine years and have no salvage value. Required: What is the maximum price (i.e., the price that exactly equals the present value of the annual savings in billing costs) that the Atlantic Medical Clinic should be willing to pay for the new computer system if the clinic's required rate of return is: (Round your final answer to the nearest whole dollar amount.) Maximum Price 1. Seven percent $ 49,164 2. Eleven percent $ 34,198A salad oil bottling plant can either buy caps for the glass bottles at 5 cents each or install $500,000 worth of plastic molding equipment and manufacture the caps at the plant. The manufacturing engineer estimates the material, labor, and other costs would be 3 cents per cap. (a) If 11 million caps per year are needed and the molding equipment is installed, what is the payback period? (b) The plastic molding equipment would be depreciated by straightline depreciation using a 6-year useful life and no salvage value. Assuming a combined 26% income tax rate, what is the after-tax payback period, and what is the after-tax rate of return?
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