Business, 21.12.2019 05:31 colton7856

Bsu inc. wants to purchase a new machine for $35,500, excluding $1,400 of installation costs. the old machine was bought five years ago and had an expected economic life of 10 years without salvage value. this old machine now has a book value of $2,200, and bsu inc. expects to sell it for that amount. the new machine would decrease operating costs by $7,500 each year of its economic life. the straight-line depreciation method would be used for the new machine, for a six-year period with no salvage value.

(a) determine the cash payback period. (round cash payback period to 1 decimal place, e. g. 10.5.)
(b) determine the approximate internal rate of return. (round answer to 0 decimal places, e. g. 10. for calculation purposes, use 5 decimal places as displayed in the factor table provided.)
(c) assuming the company has a required rate of return of 6%, determine whether the new machine should be purchased.

Answers: 1

Show answers

Another question on Business

Business, 22.06.2019 05:30

From a business perspective, an information system provides a solution to a problem or challenge facing a firm and represents a combination of management, organization, and technology elements. the organization's hierarchy, functional specialties, business processes, culture, and political interest groups are components of which element of information systems?

Answers: 1

Answer

Business, 22.06.2019 10:40

Parks corporation is considering an investment proposal in which a working capital investment of $10,000 would be required. the investment would provide cash inflows of $2,000 per year for six years. the working capital would be released for use elsewhere when the project is completed. if the company's discount rate is 10%, the investment's net present value is closest to (ignore income taxes) ?

Answers: 1

Answer

Business, 22.06.2019 11:40

During 2016, nike inc., reported net income of $3,760 million. the company declared dividends of $1,022 million. the closing entry for dividends would include which of the following? select one: a. credit cash for $1,022 million b. credit dividends for $1,022 million c. debit net income for $1,022 million d. credit retained earnings for $1,022 million e. debit dividends for $1,022 million

Answers: 1

Answer

Business, 22.06.2019 13:30

After successfully completing your corporate finance class, you feel the next challenge ahead is to serve on the board of directors of schenkel enterprises. unfortunately, you will be the only person voting for you. the company has 375,000 shares outstanding, and the stock currently sells for $40, if there are four seats in the current election, how much will it cost you to buy a seat?

Answers: 2

Answer

You know the right answer?

Bsu inc. wants to purchase a new machine for $35,500, excluding $1,400 of installation costs. the ol...

Questions