QUESTION 5 Software and hardware for optimizing the cell design of robotic picking lines have an installed cost of $78,000 with no residual value after 5 years. For years 2 and 4, use DDB (Double Declining Balance) book depreciation. The book value for year 2, (in $)

QUESTION 5 Software and hardware for optimizing the cell design of robotic picking lines have an installed cost of $78,000 with no residual value after 5 years. For years 2 and 4, use DDB (Double Declining Balance) book depreciation. The book value for year 2, (in $)

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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Chapter 3 Financial Mathematics (Exercises) Future Value Calculations Exercise 1: (answers on page 347) 1) A factory purchases new equipment which costs R5,2 million. It depreciates at a rate of 12,5% per annum on a reducing balance. The replacement cost of the equipment escalates at a rate of 7,5% per annum. A sinking fund is set up to pay for the new machinery in 6 years' time. If the sinking fund earns 9% p.a. compounded monthly, determine: a) The book value of the old equipment in 6 years' time. b) The cost of the new equipment in 6 years' time. C) The value the sinking fund must attain, if the book value of the current equipment is used towards the cost of the new equipment. d) The monthly payments that need to be made into the sinking fund if payments commence one month after the current equipment is purchased and will continue until the new equipment is purchased. The
Please no written by hand solutions Solve in a spreadsheet with excel functions A purchased machine cost $320,000, with delivery and installation charges amounting to $30,000. The declared salvage value was $50,000. Its useful life is 10 years. a) Compute the SL depreciation schedule over its useful life. b) Compute the DDB depreciation schedule over its useful life. c) Compute the MACRS depreciation schedule. Its ADR life is 12 years. d) Early in Year 4, the company changed its product mix and found that it no longer needed the machine. One of its competitors agreed to buy the machine for $110,000. Determine the loss, gain, or recapture on the sale. Use the MACRS schedule.
Problem 11-09 (Replacement Analysis) ◄ Question 4 of 6 ▸ Check My Work rtially Correct Replacement Analysis The Gilbert Instrument Corporation is considering replacing the wood steamer it currently uses to shape guitar sides. The steamer has 6 years of remaining life. If kept, the steamer will have depreciation expenses of $700 for 5 years and $345 for the sixth year. Its current book value is $3,845, and it can be sold on an Internet auction site for $4,455 at this time. If the old steamer is not replaced, it can be sold for $800 at the end of its useful life. Gilbert is considering purchasing the Side Steamer 3000, a higher-end steamer, which costs $12,200, and has an estimated useful life of 6 years with an estimated salvage value of $1,400. This steamer falls into the MACRS 5-years class, so the applicable depreciation rates are 20.00%, 32.00%, 19.20%, 11.52%, 11.52%, and 5.76%. The new steamer is faster and allows for an output expansion, so sales would rise by $2,000 per year;…
QUESTION 3 Your dad made the following estimates as he considered upgrading the air-conditioning system in their home. Use AW analysis to determine the sensitivity of the economic decision to interest rates of 4%, 6%, and 8% per year. Is the decision sensitive to a change in interest rates within this range? System 1 2 First cost, $ -10,000 -17,000 Annual operating cost, $ -600 -150 Salvage (disposal) value, $ -100 -300 New compressor and motor cost at midlife, $ -1,750 -3,000 Life, years 8 12 O Yes O No
QUESTION C A local authority's Fire Service is considering replacement of a turntable ladder which although still serviceable, has steeply rising maintenance costs, and it is thought that a replacement will proof less expensive in the long term. The purchase cost of a new turntable ladder will be $360,000 - half payable immediately and half one year from now. The following information is available: - Existing 8 Years 8 years Replacement 8 Years 8 years Estimated useful life Estimated costs: Year 1 40,000 10,000 Year 2 45,000 10,000 Year 3 50,000 14,000 Year 4 60,000 15,000 Year 5 72,000 18,000 Year 6 80,000 18,000 Year 7 90,000 20,000 Year 8 98,000 22,000 Full Overhauls Year 2 5,000 Year 4 10,000 4,000 Year 6 14,000 Estimated Resale Value Now 10,000 Year 8 1,000 maintenance 8,000
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If a new machine is purchased for OMR 200,000 that has a useful life of 5 years with no residual value and the current cost of the machine after 2 years is OMR 180,000 and transportation charges are OMR 10,000 then what would be the realizable value of the machine? a. OMR 170,000 b. OMR 180,000 c. OMR 160,000 d. OMR 186,000
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