Span Fruit Compain has used a particular canning machine for several years. The machine has a zero salvage value. The company is considering buying a technologically improved machine at a cost of $2.^2.()()(). The new machine will save S.'iO.OOO per year after taxes in cash operating costs. If the company decides not to buy the new machine, it can use the old machine for an indehnite time by incurring heavy repair costs. The new machine wduld have an estimated useful life of eight years.

a. Compute the time-adjusted rate of return for the new machine.

b. Management thinks the estimated useful life of the new machine may be more or less than eight years. Compute the time-adjusted rate of return for the new machine if its useful life is ( 1 ) 5 years and (2) 12 years, instead of 8 years.

c. Suppose the new machine's useful life is eight years, but the annual after-tax cost savings are only $45,000. Compute the time-adjusted rate of return.

d. Assume the annual after-lax cost savings from the new machine will be S>35.()()0 and its useful life will be 10 years. Compute the time-adjusted rate of return. mk4