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1, UNU IRR. TERMEDIATE (Questions 23-28) LO 2 23. Cost-Cutting Proposals CSM Machine Shop is considering a fou project to improve its production efficiency. Buying
1, UNU IRR. TERMEDIATE (Questions 23-28) LO 2 23. Cost-Cutting Proposals CSM Machine Shop is considering a fou project to improve its production efficiency. Buying a new machine $395,000 is estimated to result in $144,000 in annual pretax cost The press falls in the MACRS five-year class, and it will have a s machine press for il pretax cost savings. teurized pur Juicege CHAPTER 9 Making Capital Investment Decisions 307 value at the end of the proje investment in spare parts inven $2.000 in inventory for each si rate is 22 percent and its the project of $45,000. The press also requires an initin re parts inventory of $15,000, along with an additional ory for each succeeding year of the project. If the shop's tax ant and its discount rate is Il percent, should the company buy and install the machine press
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