X Company currently buys 8,000 units of a component part each year from a supplier for $8.50 each, but it is considering making the part instead. In order to make the part, X Company will have to buy equipment that will cost $150,000. The equipment will last for six years, at which time it will have zero disposal value. X Company estimates that it will cost $37,490 a year to make the 8,000 units. What is the approximate rate of return if X Company makes the part instead of buying it from the supplier?
Q: please help
A: Detailed explanation:Depreciation is the decrease in the value of the asset due to constant use,…
Q: The net income reported on the income statement for the current year was $315,287. Depreciation…
A: The indirect method of the cash flow statement allows us to calculate the net cash flow from…
Q: Am. 129.
A: To calculate the Earned Income Credit (EIC) for Samuel and Annamaria, we need to follow these…
Q: am. 115.
A: Step 1: Step 2: Step 3: Step 4:
Q: None
A: Step 1: Find the net income Under the indirect method, the cash flows are calculated by adjusting…
Q: 8. Wadhams Snow Removal's cost formula for its vehicle operating cost is $1,900 per month plus $430…
A: Step 1: Introduction to budgetingBudgeting is defined as the process of preparing a financial plan…
Q: Gadubhai
A: Solutions: 1. Times interest earned ratio = EBIT/Interest expense($10,300/980) = 10.51 times 2.…
Q: This is a multiple answer question. NEO 4 pe November 2025, Gotta Company paid $5,000 to a supplier…
A: Detailed Explanation of the Solution and Incorrect OptionsScenario:A company purchases inventory on…
Q: ! Required information Problem 12-37 (LO 12-2) (Static) [The following information applies to the…
A: The 83(b) election is a provision under the Internal Revenue Code (IRC) that gives an employee, or…
Q: None
A: In conclusion, title insurance is an important aspect of real estate transactions that helps protect…
Q: am. 105.
A: DETAILED ANALYSIS TO ANCHOR THE ABOVE SOLUTIONSFlexible Administration, Selling, and Distribution…
Q: Need Help please
A: 1. Discounted Payback Period CalculationThe goal is to determine how many years it takes for the…
Q: Alpesh
A: Step 1:DateAssets=liabilities +Stockholder's Equity 11/1/2021cash 8,400,000 Notes…
Q: The internal rate of return method is used by Royston Construction Co. in analyzing a capital…
A: The objective of the question is to calculate the present value factor for an annuity of $1 and then…
Q: You would like to be holding a protective put position on the stock of XYZ Company to lock in a…
A: Required A: To determine the desired put option that would give a guaranteed minimum value, you…
Q: Jamie's regular hourly wage rate is $16, and she receives an hourly rate of $24 for work in excess…
A: Step 1:Step 2:Step 3:Step 4:
Q: As the chief financial officer of Adirondack Designs, you have the following information: Next…
A: a. Calculate Total funds raised from selling new shares:Total funds raised = 1.3 million shares *…
Q: please answer in text form with proper workings and explanation for each and every part and steps…
A: Detailed explanation: April MayJuneJulyUnits to produce 500 630 600 600Materials required per…
Q: Customer Bad Debt Expense, Aging of Accounts Receivable, Journal Entry. Giaraldi Garden Products,…
A: Note: If you have any clarifications (i.e., expand the explanation) or want different, expanded, or…
Q: Top Sound International designs and sells high-end stereo equipment for auto and home use. Engineers…
A: Contingent Liability Treatment for Top Sound InternationalScenario: Top Sound International faces a…
Q: A project is estimated to cost $219,835 and provide annual net cash flows of $77,000 for four years.…
A: The objective of this question is to calculate the internal rate of return (IRR) for a project using…
Q: Gemstone Distributors reports net income of $63,000. Included in that number is depreciation expense…
A: Computation of the net cash flows from operating activities:…
Q: Manji
A: Let's examine the computations for each of the two components in further detail: a. Maximum §179…
Q: During 2016, Tranquil Waters Spa reported revenue of $20,000. Total expenses for the year were…
A: Detailed Solutions to Tranquil Waters Spa's Financial PerformanceQuestion 1: Compute Tranquil Waters…
Q: Vishnu
A: The above answer can be explained as under - The stock dividend has been declared. The retained…
Q: provide answer all of three
A: 1. To find the gain or loss on disposal of the fixed asset, we first need to calculate the book…
Q: Rahul
A: The financial data for Virtual Gaming Systems includes balance sheets for 2023, 2024, and 2025 as…
Q: Please check the answer and add explanation properly at every steps and solve steps wise
A: The Internal Rate of Return (IRR) is a capital budgeting tool used to evaluate investment…
Q: Consider the following data collected for Albo's Rentals: Direct…
A: Direct materials price variance is the difference between the actual materials at actual price and…
Q: please answer in text form with proper workings and explanation for each and every part and steps…
A: Step 1Calculation of Overhead:The overhead rate is applied at 90% of direct labor costs. Calculate…
Q: Warren Co. recorded a right-of-use asset of $830,000 in a 10-year finance lease. The interest rate…
A:
Q: ! Required information P10-6 (Algo) Recording and Reporting Bonds Issued at a Discount LO10-4 [The…
A: Regarding June 30: There have been four interest payments made (06/30/2022, 06/30/2021, 12/31/2021,…
Q: Ahmad is an entrepreneur and owner of the company. He thinks whether should he continue his activity…
A: Data Available Initial capital550,000Salaries for hiired employees11,000Rent2,000Communal…
Q: Medium Manufacturers, Inc. (MMI) has the following items on its Income Statement for last year:…
A: To find the Beginning of Year Retained Earnings Balance for MMI last year, we need to use the…
Q: please answer in text form with proper workings and explanation , narrations for each and every…
A: Explanation:Step 1: When bonds are issued at a discount, the cash received is less than the face…
Q: Please do not give solution in image format thanku
A: Step 1:
Q: "Blast it!" said David Wilson, president of Teledex Company. "We've just lost the bid on the Koopers…
A: Plantwide Predetermined Overhead RateThe total estimated manufacturing overhead for the plant =…
Q: Denger
A: Let's examine each journal entry in greater detail: 2025: For a total purchase price of $1,205,000,…
Q: Please correct answer and don't use hend raiting and step by step solutions
A: To find the price of a call option with the same exercise price, we can use put-call parity, which…
Q: Please provide both Answer
A: Required Answer : 1 Step 1 : Discount Payback PeriodThe method followed in capital budgeting to…
Q: Vikrambhai
A: Based on the information provided, the coupon rate of the bond is 4.7%.We can't directly calculate…
Q: Land Lords Inc. Budgeted Balance Sheet June 30 Liabilities and Shareholders' Equity Assets Cash…
A: Remember the equation: Assets = Liabilities + EquityCash + Accounts Receivable + Inventory +…
Q: Through the classifieds of the Miami Herald Rhonda Brennan found her first job after graduating from…
A: To calculate Rhonda's take-home pay for her first check, we need to determine her gross pay,…
Q: Complete the following partial flexible budget performance report, and indicate whether each…
A: Step 1:Flexible budget performance report is presented hereunder:…
Q: Assume your goal in life is to retire with one million dollars. How much would you need to save at…
A: The objective of this question is to calculate the annual savings required to accumulate one million…
Q: Assume you want to retire early at age 54. You plan to save using one of the following two…
A: Part 2:Explanation:Step 1: Calculate the out-of-pocket cash investment for Option 1:Under Option 1,…
Q: The Jamaica Company manufactures a product in a single process, The following information is…
A: To calculate the amount to be charged to the costing profit and loss account for the period, we need…
Q: Please do not give solution in image format thanku
A: Detailed Calculation of Overhead Controllable Variance and Overhead Volume VarianceScenario:Actual…
Q: Majid Corporation sells a product for $145 per unit. The product's current sales are 41,300 units…
A: Margin of safety measures the excess of the current sales to the break-even sales. It is calculated…
Q: An accounting firm has 780 hours of staff time and 272 hours of reviewing time available each week.…
A: The objective of the question is to find the optimal number of audits and tax returns that the…
Step by step
Solved in 2 steps with 1 images
- Dauten is offered a replacement machine which has a cost of 8,000, an estimated useful life of 6 years, and an estimated salvage value of 800. The replacement machine is eligible for 100% bonus depreciation at the time of purchase- The replacement machine would permit an output expansion, so sales would rise by 1,000 per year; even so, the new machines much greater efficiency would cause operating expenses to decline by 1,500 per year The new machine would require that inventories be increased by 2,000, but accounts payable would simultaneously increase by 500. Dautens marginal federal-plus-state tax rate is 25%, and its WACC is 11%. Should it replace the old machine?Caduceus Company is considering the purchase of a new piece of factory equipment that will cost $565,000 and will generate $135,000 per year for 5 years. Calculate the IRR for this piece of equipment. For further instructions on internal rate of return In Excel, see Appendix C.Swifty Industries is considering the purchase of new equipment costing $432,000 to replace existing equipment that will be sold for $64,800. The new equipment is expected to have a $72,000 salvage value at the end of its 1-year life. During the period of its use, the equipment will allow the company to produce and sell an additional 10,800 units annually at a sales price of $7 per unit. Those units will have a variable cost of $4 per unit. The company will also incur an additional $32,400 in annual fixed costs.Click here to view the factor table.(a) Calculate the net present value of the proposed equipment purchase. Assume that Swifty uses a 4% discount rate. (For calculation purposes, use 4 decimal places as displayed in the factor table provided and round final answer to 0 decimal place, e.g. 58,971. Enter negative amount using a negative sign preceding the number e.g. -59,992 or parentheses e.g. (59,992).) Net present value $ (b) Do you recommend that Swifty Industries…
- White Bakery plans to produce 15,000 cakes per year. The company is considering purchasing new cake decorating equipment. The new equipment would cost $30,000. This equipment qualifies for the use of MACRS (3-year asset class) and would be sold at the end of 3 years for an estimated $6,000. The company estimates that with the new equipment revenues will be $2.60 per cake and variable expenses will be $2 per cake. All revenues and expenses are paid in cash. The company does not have any fixed expenses. A 10% rate of return is required on all investments (cost of capital is 10%). White expects its tax rate to be 30%. What is an accounting rate of return on original investment (ignoring taxes; e.g., assume that the tax rate is zero)? What is a payback period on this investment (ignoring taxes; e.g., assume that the tax rate is zero)?Guthrie Enterprises needs someone to supply it with 142,000 cartons of machine screwsper year to support its manufacturing needs over the next five years. It willcost $1,820,000 to install the equipment necessary to start production; you’ll depreciatethis cost straight-line to zero over the project’s life. You estimate that in five years thisequipment can be salvaged for $152,000. Your fixed production costs will be $267,000 peryear, and your variable production costs should be $9.60 per carton. You also need aninitial investment in net working capital of $132,000. The tax rate is 22 percent and youYear Market Value ($ millions)1 $ 14.702 $11.703 $9.204 $1.95require a return of 12 percent on your investment. Assume that the price per carton is$16.20.b. What is the minimum number of cartons per year that can be supplied and stillguarantee a zero NPV? Verify that the quantity you calculated is enough to atleast have a zero NPV.c. What are the highest fixed costs that could be incurred…Guthrie Enterprises needs someone to supply it with 142,000 cartons of machine screwsper year to support its manufacturing needs over the next five years. It willcost $1,820,000 to install the equipment necessary to start production; you’ll depreciatethis cost straight-line to zero over the project’s life. You estimate that in five years thisequipment can be salvaged for $152,000. Your fixed production costs will be $267,000 peryear, and your variable production costs should be $9.60 per carton. You also need aninitial investment in net working capital of $132,000. The tax rate is 22 percent and you require a return of 12 percent on your investment. Assume that the price per carton is$16.20.a. Calculate the project NPV.b. What is the minimum number of cartons per year that can be supplied and stillguarantee a zero NPV? Verify that the quantity you calculated is enough to atleast have a zero NPV.c. What is the highest fixed costs that could be incurred and still guarantee a zeroNPV?…
- A company is considering several mutually exclusive ways that can meet a requirement for a filling machine for its creamer line. One choice is to buy a machine. This would cost $75 000 and last for six years with a salvage value of $12 000. Alternatively, it could contract with a packaging supplier to get a machine free. In this case, the extra costs for packaging supplies would amount to $17 500 per year over the six-year life (after which the supplier gets the machine back with no salvage value for the company). The third alternative is to buy a used machine for $40 000 with zero salvage value after six years. The used machine has extra maintenance costs of $3500 in the first year, increasing by $2500 per year. In all cases, there are installation costs of $8000 and revenues of $25 000 per year. a) Using the IRR method, determine which is the best alternative. The MARR is 10 percent.A company sells Gizmos to consumers at a price of $90 per unit. The costs to produce Gizmos is $38 per unit. The company will sell 14,000 Gizmos to consumers each year. The fixed costs incurred each year will be $180,000. There is an initial investment to produce the goods of $3,800,000 which will be depreciated straight line over 11 year life of the investment to a salvage value of $0. The opportunity cost of capital is 9% and the tax rate is 31%. A. What is operating cash flow each year? B. Using an operating cash flow of 485, 210.91 each year, what is the NPV of this project? C. Given a net present value of $-498, 047.3, should the company accept or reject this project? D. Find the net present value break-even level of units sold. Round your answer to the nearest whole unitRey
- Bridgeport Industries is considering the purchase of new equipment costing $1,280,000 to replace existing equipment that will be sold for $194,000. The new equipment is expected to have a $220,000 salvage value at the end of its 5-year life. During the period of its use, the equipment will allow the company to produce and sell an additional 32,800 units annually at a sales price of $29 per unit. Those units will have a variable cost of $15 per unit. The company will also incur an additional $86,000 in annual fixed costs. Identify the amount and timing of all cash flows related to the acquisition of the new equipment. (Enter negative amounts using a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Cash Flow Timing Amount Purchase of new equipment $4 Salvage of old equipment Sales revenue Variable costs Additional fixed costs Salvage of new equipment >Please help me i will surely like please make sure its correctCulver Industries is considering the purchase of new equipment costing $732,000 to replace existing equipment that will be sold for $109,800. The new equipment is expected to have a $122,000 salvage value at the end of its 2-year life. During the period of its use, the equipment will allow the company to produce and sell an additional 18,300 units annually at a sales price of $12 per unit. Those units will have a variable cost of $7 per unit. The company will also incur an additional $54,900 in annual fixed costs.Click here to view the factor table.(a) Calculate the net present value of the proposed equipment purchase. Assume that Culver uses a 7% discount rate. (For calculation purposes, use 4 decimal places as displayed in the factor table provided and round final answer to 0 decimal place, e.g. 58,971. Enter negative amount using a negative sign preceding the number e.g. -59,992 or parentheses e.g. (59,992).) Net present value $ (b) Do you recommend that Culver…