82.

The Pan American Bottling Co. is considering the purchase of a new machine that would increase the speed of bottling and save money. The net cost of this machine is $57,000. The annual cash flows have the following projections. Use Appendix B and Appendix D for an approximate answer but calculate your final answer using the formula and financial calculator methods.

Year	Cash Flow
1	$	21,000
2		24,000
3		28,000
4		14,000
5		9,000

a. If the cost of capital is 11 percent, what is the net present value of selecting a new machine? (Do not round intermediate calculations and round your final answer to 2 decimal places.)

b. What is the internal rate of return? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)

28.

The Bradley Corporation produces a product with the following costs as of July 1, 20X1:

Material	$1 per unit
Labor	3 per unit
Overhead	2 per unit

Beginning inventory at these costs on July 1 was 3,050 units. From July 1 to December 1, 20X1, Bradley produced 12,100 units. These units had a material cost of $2, labor of $4, and overhead of $2 per unit. Bradley uses LIFO inventory accounting.

a. Assuming that Bradley sold 13,200 units during the last six months of the year at $13 each, what is its gross profit?

b. What is the value of ending inventory?

30.

The Denver Corporation has forecast the following sales for the first seven months of the year:

January	$	22,000	May	$	22,000
February		24,000	June		28,000
March		26,000	July		30,000
April		32,000

Monthly material purchases are set equal to 25 percent of forecast sales for the next month. Of the total material costs, 35 percent are paid in the month of purchase and 65 percent in the following month. Labor costs will run $5,200 per month, and fixed overhead is $8,000 per month. Interest payments on the debt will be $4,200 for both March and June. Finally, the Denver salesforce will receive a 1.50 percent commission on total sales for the first six months of the year, to be paid on June 30.

Prepare a monthly summary of cash payments for the six-month period from January through June. (Note: Compute prior December purchases to help get total material payments for January.)