Two machinės are av ay Foods must purchase a new gumdrop machin chine 7745 has a first cost of $10,000, an estimated life of 10 years, a sal ue of $1,000, and annual operating costs estimated at $0.01 per 1,000 gu chine A37Y has a first cost of $9,000, a life of 10 years, and no salvage va ual operating costs will be $250 regardless of the number of gumdrops duced. MARR is 8% per year, and 15 million gumdrops are produced each ar. Which machine should be recommended?

Two machinės are av ay Foods must purchase a new gumdrop machin chine 7745 has a first cost of $10,000, an estimated life of 10 years, a sal ue of $1,000, and annual operating costs estimated at $0.01 per 1,000 gu chine A37Y has a first cost of $9,000, a life of 10 years, and no salvage va ual operating costs will be $250 regardless of the number of gumdrops duced. MARR is 8% per year, and 15 million gumdrops are produced each ar. Which machine should be recommended?

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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The concrete pavement requires $15,000 of repairs during years 12, 25 and 40 • The asphalt pavement requires $125,000 of repairs during years to, 20, 35 and 45 • The estimated capital cost of the concrete pavement is $980,l00• The estimated capital cost of the asphalt pavement is $850,000 • Assume interest rate = 4% • Assume no salvage value at the end of life. Find the PWF and LCC Please do fast asap
Sandhill Corp, is considering purchasing one of two new diagnostic machines. Either machine would make it possible for the company to bid on jobs that it currently isn't equipped to do. Estimates regarding each machine are provided here. Original cost Estimated life Salvage value Estimated annual cash inflows Estimated annual cash outflows Machine A $77,300 8 years 0 $20,200 $4,970 Machine B $180,000 8 years 0 $40,000 $9,860
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BAK Corp. is considering purchasing one of two new diagnostic machines. Either machine would make it possible for the company to bid on jobs that it currently isn't equipped to do. Estimates regarding each machine are provided below. Machine A Machine B Original cost $75,700 $182,000 Estimated life 8 years 8 years Salvage value Estimated annual cash inflows $20,300 $39,700 Estimated annual cash outflows $4,870 $10,050 Click here to view the factor table. Calculate the net present value and profitability index of each machine. Assume a 9% discount rate. (If the net present value is negative, use either a negative sign preceding the number eg -45 or parentheses eg (45). Round answer for present value to O decimal places, e.g. 125 and profitability index to 2 decimal places, e.g. 10.50. For calculation purposes, use 5 decimal places as displayed in the factor table provided.) Machine A Machine B Net present value Profitability index
Please view the following video before answering this question. Video Solution: 11.01-PR007 A pipeline contractor can purchase a needed truck for $44,000. Its estimated life is 6 years, and it has no salvage value. Maintenance is estimated to be $2,100 per year. Operating expense is $60 per day. The contractor can hire a similar unit for $130 per day. MARR is 7%. Click here to access the TVM Factor Table Calculator Part a How many days per year must the truck's services be needed such that the two alternatives are equally costly? days Carry all interim calculations to 5 decimal places and then round your final answer up to the nearest day. The tolerance is 14. Attempts: 0 of 3 used Save for Later Submit Answer
BAK Corp. is considering purchasing one of two new diagnostic machines. Either machine would make it possible for the company to bid on jobs that it currently isn't equipped to do. Estimates regarding each machine are provided below. Original cost Estimated life Salvage value Estimated annual cash inflows Estimated annual cash outflows Net present value Machine A $78,200 8 years Profitability index 0 $19,800 $5,130 Machine A Machine B $182,000 8 years Click here to view the factor table. Calculate the net present value and profitability index of each machine. Assume a 9% discount rate. (If the net present value is negative, use either a negative sign preceding the number eg-45 or parentheses eg (45). Round answer for present value to 0 decimal places, e.g. 125 and profitability index to 2 decimal places, e.g. 10.50. For calculation purposes, use 5 decimal places as displayed in the factor table provided.) 0 $39,600 $10,180 Machine B
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BAK Corp. is considering purchasing one of two new diagnostic machines. Either machine would make it possible for the company to bid on jobs that it currently isn’t equipped to do. Estimates regarding each machine are provided below. Machine A Machine B Original cost $74,100 $183,000 Estimated life 8 years 8 years Salvage value 0 0 Estimated annual cash inflows $20,500 $39,500 Estimated annual cash outflows $4,850 $10,020 Calculate the net present value and profitability index of each machine. Assume a 9% discount rate. (If the net present value is negative, use either a negative sign preceding the number eg -45 or parentheses eg (45). Round answer for present value to 0 decimal places, e.g. 125 and profitability index to 2 decimal places, e.g. 10.50. For calculation purposes, use 5 decimal places as displayed in the factor table provided.) Machine A Machine B Net present value enter a dollar amount rounded to 0…
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