Machine A costs 10,000 and costs 3,000 per year to maintain. It is expected to last 3
Question:
Machine A costs £10,000 and costs £3,000 per year to maintain. It is expected to last 3 years. Machine B costs £8,000 and costs £5,000 per year to maintain. It is expected to last 2 years. Assume the discount rate is 7 per cent. Which machine should be purchased?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 66% (3 reviews)
To determine which machine is the better purchasewe need to consider the total present value of thei...View the full answer
Answered By
Asim farooq
I have done MS finance and expertise in the field of Accounting, finance, cost accounting, security analysis and portfolio management and management, MS office is at my fingertips, I want my client to take advantage of my practical knowledge. I have been mentoring my client on a freelancer website from last two years, Currently I am working in Telecom company as a financial analyst and before that working as an accountant with Pepsi for one year. I also join a nonprofit organization as a finance assistant to my job duties are making payment to client after tax calculation, I have started my professional career from teaching I was teaching to a master's level student for two years in the evening.
My Expert Service
Financial accounting, Financial management, Cost accounting, Human resource management, Business communication and report writing. Financial accounting : • Journal entries • Financial statements including balance sheet, Profit & Loss account, Cash flow statement • Adjustment entries • Ratio analysis • Accounting concepts • Single entry accounting • Double entry accounting • Bills of exchange • Bank reconciliation statements Cost accounting : • Budgeting • Job order costing • Process costing • Cost of goods sold Financial management : • Capital budgeting • Net Present Value (NPV) • Internal Rate of Return (IRR) • Payback period • Discounted cash flows • Financial analysis • Capital assets pricing model • Simple interest, Compound interest & annuities
4.40+
65+ Reviews
86+ Question Solved
Related Book For
Corporate Finance
ISBN: 9780077173630
3rd Edition
Authors: David Hillier, Stephen A. Ross, Randolph W. Westerfield, Bradford D. Jordan, Jeffrey F. Jaffe
Question Posted:
Students also viewed these Business questions
-
Managing Scope Changes Case Study Scope changes on a project can occur regardless of how well the project is planned or executed. Scope changes can be the result of something that was omitted during...
-
ABC Company has the following mutually exclusive projects. If the company's payback period is 2 years, which of these projects should be chosen? Project A Year 0 -19,500 1 11,500 2 8,750 3 2,500...
-
A town estimates that it will cost $160 million to design and construct a new water treatment plant and $12.5 million per year to maintain the plant which is expected to last for 10 years. The plant...
-
Discuss why you would or would not like to work in an organization like this?
-
Which of the following pairs of portfolios have the same payoff? (A). a risk-free bond that promises $100 in three months; (B). a short call and short put both struck at $100 with expiration date of...
-
Early in 2018, Robbinsville Press was organized with authorization to issue 100,000 shares of $100 par value preferred stock and 500,000 shares of $1 par value common stock. Ten thousand shares of...
-
The Evanston Company produces a single product on a continuous basis. On July 1, 600 units, 75 percent complete as to materials and 50 percent complete as to conversion, were in process. During...
-
What is the fundamental motivation behind portfolio theory? That is, what are people trying to achieve by investing in portfolios of stocks rather than in a few individual stocks or in debt? What...
-
Complete the table t Expression Two. Dine like terms when adding Expression One and 14b -1 16 156 16b 14 Expression One Expressi b+15 15b- CLEAR
-
Hagar Industrial Systems Company (HISC) is trying to decide between two different conveyor belt systems. System A costs 430,000 Norwegian kroner (NKr), has a 4-year life, and requires NKr120,000 in...
-
Howell Petroleum is considering a new project that complements its existing business. The machine required for the project costs 2 million. The marketing department predicts that sales related to the...
-
Two violin strings are tuned to the same frequency, 2.0%. What will be the beat frequency heard when the two strings are played together?
-
Pizza Hut is a restaurant franchise with headquarters in Texas, United States. The firm is renowned for its delicious, economical, accessible, and extensive selection of pizzas. Pizza Hut has...
-
Shortages of new tech products have become so common that it is easy to take them for granted. Over the past couple of years, inventories for Google's Pixel phone, Nintendo's Switch, and Apple's...
-
A cat leaps to try to catch a bird. If the cat's jump was at an angle 46.1 degree above the horizontal and its initial velocity was 21.1 m/s. What is the highest point of its trajectory (in unit of...
-
Bed & Bath, a retailing company, has two departments Hardware and Linens. The company s most recent monthly contribution format income statement follows: Total Department Hardware Linens Sales $ 4 ,...
-
Point charge B (-2.05 mC) is located a distance 87.6 cm to the right of point charge A (1.85 mC). i) Find the electric force of A on B. -4.443x104 N You are correct. Your receipt no. is 163-6810...
-
Selected data from Quach Company follow. Required Compute the following and round computations to two decimal points. a. The accounts receivable turnover for 2015. b. The inventory turnover for 2015....
-
The roof of a refrigerated truck compartment is of composite construction, consisting of a layer of foamed urethane insulation (t2 = 50 mm, ki = 0.026 W/m K sandwiched between aluminum alloy panels...
-
Band Ratings Companies pay rating agencies such as Moodys and S&P to rate their bonds, and the costs can be substantial. However, companies are not required to have their bonds rated; doing so is...
-
Band Ratings Companies pay rating agencies such as Moodys and S&P to rate their bonds, and the costs can be substantial. However, companies are not required to have their bonds rated; doing so is...
-
Band Ratings Companies pay rating agencies such as Moodys and S&P to rate their bonds, and the costs can be substantial. However, companies are not required to have their bonds rated; doing so is...
-
Apr. 30. Declared semiannual dividends of $0.75 on 18,000 shares of preferred stock and $0,28 on the common stock payable on July 1. Apr. 30 Cash Dividends x Cash Dividends Payable Feedback Check My...
-
Net Present Value Method for a Service Company Opulence Corporation has recently placed into service some of the largest cruise ships in the world. One of these ships, the Bellwether, can hold up to...
-
Presented below are incomplete 2022 manufacturing cost data for Cullumber Corporation. Determine the missing amounts. Direct Materials Used Direct Labor Manufacturing Total Manufacturing Overhead...
Study smarter with the SolutionInn App