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3 13 01:12:27 (Ignore income taxes) Warm Belly Donut Shoppe is investigating the purchase of a new $42,900 donut- making machine. The new machine

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3 13 01:12:27 (Ignore income taxes) Warm Belly Donut Shoppe is investigating the purchase of a new $42,900 donut- making machine. The new machine would permit the company to reduce the amount of part-time help needed, at a cost savings of $5,800 per year. In addition, the new machine would allow the company to produce one new style of donut, resulting in the sale of 2,000 dozen more donuts each year. The company realizes a contribution margin of $2.00 per dozen donuts sold. The new machine would have a six-year useful life. Help Required: 1. What would be the total annual cash inflows associated with the new machine for capital budgeting purposes? 2. What is the new machine's internal rate of return? Note: Round your final answer to the nearest whole percentage. 3. In addition to the data given previously, assume that the machine will have a $16,575 salvage value at the end of six years. Under these conditions, what is the internal rate of return? Note: Round your final answer to the nearest whole percentage. 1. Annual cash inflows 2. Internal rate of return % 3. Internal rate of return %

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