The initial cost of one customized machine is $675,000 with an annual operating cost of $14,800, and a life of 4 years. The machine will be worthless and replaced at the end of its life. What is the equivalent annual cost of this machine if the required rate of return is 14.5 percent and we ignore taxes? USING EXCEL FORMULAS
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The initial cost of one customized machine is $675,000 with an annual operating cost of $14,800, and a life of 4 years. The machine will be worthless and replaced at the end of its life. What is the equivalent annual cost of this machine if the required
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- A new electronic process monitor costs $990,000. This cost could be depreciated at 30% per year (Class 10). The monitor would actually be worthless in five years. The new monitor would save $460,000 per year before taxes and operating costs. If we require a 15% return, what is the NPV of the purchase? Assume a tax rate of 40%. (Do not round intermediate calculations. Round the final answer to 2 decimal places. Omit $ sign in your response.) NPVA new electronic process monitor costs $990,000. This cost could be depreciated at 30 percent per year (Class 10). The monitor would actually be worthless in five years. The new monitor would save $460,000 per year before taxes and operating costs. If we require a 15 percent return, what is the NPV of the purchase? Assume a tax rate of 40 percent. (Do not round intermediate calculations. Round the final answer to 2 decimal places.) NPVYour company is considering the replacing an old machine with a more efficient model. The new machine costs $39,500, will last for 7 years and save $12,900 per year in expenses. The discount rate is 18% and the tax rate is 26%. The machine will be depreciated on a straight line basis to zero. The old machine is fully depreciated and can be sold today for $2,700. A) what is the amount of initial investment required? B) what is the after-tax gain on the sale of the old machine? The old machine is fully depreciated. C) what is the amount of operating cash flow (OCF) per year? D) what is the NPV of the project?
- You are considering a CNC machine. This machine will have an estimated service life of 10 years with a salvage value of 10% of the investment cost. Its expected savings from annual operating and maintenance costs are estimated to be $60,000. To expect a 15% rate of return on investment, what would be the maximum amount that you are willing to pay for the machine? (your answer must be rounded off to the nearest dollars, i.e., no decimal places) Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.You are considering purchasing a CNCmachine which costs $150,000. This machine willhave an estimated service life of 10 years with a netafter-tax salvage value of $15,000. Its annual aftertax operating and maintenance costs are estimatedto be $50,000. To expect an 18% rate of return oninvestment, what would be the required minimumannual after-tax revenues?Assume a machine costs $250,000 and lasts five years before it is replaced. The operating cost is $37,200 a year. Ignore taxes. What is the equivalent annual cost if the required rate of return is 8.5 percent? (Hint: the EAC should account for both investment and annual operating costs) O $124,166.76 O $118,285.43 O $112,404.10 O$106,522.77 $100,641.44
- Your boss asked you to evaluate a project with an infinite life. Sales and costs project to $1,000 and $500 per year, respectively. (Assume sales and costs occur at the end of the year [i.e., profit of $500 at the end of year one]). There is no depreciation and the tax rate is 30 percent. The required rate of return is 10 percent. If the project costs $3,000, what is the NPV?Assumption Corporation is considering replacing an obsolete machine with a new machine. The new machine would cost P250,000 and would have a ten-year useful life. The new machine would cost P12,000 per year to operate and maintain, but would save P55,000 per year in labor and other costs. The old machine can be sold now for P10,000. The simple rate of return on the new machine is closest to: a. 17.9% b. 7.5% c. 22.0% d. 7.2%A new electronic process monitor costs $990,000. This cost could be depreciated at 30% per year (Class The monitor would actually be worth $100,000 in five years. The new monitor would save $460,000 per year before taxes and operating costs. Suppose the new monitor requires us to increase net working capital by $47,200 when we buy it. If we require a 15% return, what is the NPV of the purchase? Assume a tax rate of 40%. (Do not round intermediate calculations. Round the final answer to 2 decimal places. Omit $ sign in your response.)
- A new electronic process monitor costs $990,000. This cost could be depreciated at 30% per year (Class 10). The monitor would actually be worth $100,000 in five years. The new monitor would save $460,000 per year before taxes and operating costs. Suppose the new monitor requires us to increase net working capital by $47,200 when we buy it. If we require a 15% return, what is the NPV of the purchase? Assume a tax rate of 40%. (Do not round intermediate calculations. Round the final answer to 2 decimal places. Omit $ sign in your response.) NPV $194719.60A new electronic process monitor costs $990,000. This cost could be depreciated at 30% per year (Class 10). The monitor would actually be worth $100,000 in five years. The new monitor would save $460,000 per year before taxes and operating costs. Suppose the new monitor requires us to increase net working capital by $47,200 when we buy it. If we require a 15% return, what is the NPV of the purchase? Assume a tax rate of 40%. (Do not round intermediate calculations. Round the final answer to 2 decimal places. Omit $ sign in your response.) NPV $ 94186.67 xA precision lathe costs $11,300 and will cost $26,500 a year to operate and maintain. If the discount rate is 12% and the lathe will last for 4 years, what is the equivalent annual cost of the tool? (Enter your answer as positive value. Round your answer to the nearest cent.) The equivalent annual cost $