Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

6. A new operating system for an existing machine is expected to cost $800,000 and have a useful life of six years. The system ylelds

image text in transcribed
image text in transcribed
6. A new operating system for an existing machine is expected to cost $800,000 and have a useful life of six years. The system ylelds an incremental after-tax income of $265,000 each year after deducting its straight-line depreciation. The predicted salvage value of the system is $13,000 b. A machine costs $600.000, has a $36.800 salvage value, is expected to last eight years, and will generate an after-tax income of $90,000 per year after straight line depreciation Assume the company requires a 12% rate of return on its investments Compute the net present value of each potential Investment EVOLS EVOL.SI, EVA ES1. and EVAS (Use oppropriate factor(s) from the tables provided.) Complete this question by entering your answers in the tabs below. Required A Required A new operating system for an existing machine is expected to cost $800,000 and have a useful life of six years. The system yields an incremental after-tax income of $265,000 each year after deducting its straightIne depreciation. The predicted Salvage value of the system is $13,000. (Round your answers to the nearest whole dollar) Select Chart Amount XPV Factor Present Value Cash Flow Annot show Fondu Non present in Food o. A new operating system for an existing machine is expected to cost $800,000 and have a useful Ne of six years. The system yields an incremental after-tax income of $265.000 each year after deducting its straight-line depreciation. The predicted salvage value of the system is $13,000 b. A machine costs $600.000, has a $36.800 salvage volue, is expected to last eight years, and will generate an after-tax income or $90,000 per year after straight line depreciation, Assume the company requires a 12% rate of return on its investments. Compute the net present value of each potential investment POL1. EVO.S. PVA Su and EVA OLS1) (Use appropriate factor(s) from the tables provided.) Complete this question by entering your answers in the tabs below. Required A Required A machine costs $600,000, has a $36,800 Salvage value, I expected to tastelght years, and will generate an after tax income of $90,000 per year after straight line depreciation found your answers to the nearest whole della Select Chart Amount X PV Factor Cash Flow Annich Residuo Present Value $ 0 D NOT Orion V

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Accounting The Impact On Decision Makers

Authors: Curtis L. Norton, Gary A. Porter

6th Edition

9781439037119, 1439037116

More Books

Students also viewed these Accounting questions

Question

Repeat Problem 77 with an order of 1,200 units every 4 months.

Answered: 1 week ago

Question

why do consumers often fail to seek out higher yields on deposits ?

Answered: 1 week ago