A special-purpose machine tool set would cost $20,000. The tool set will be financed by a $10,000 bank loan repayable in two equal annual installments at 10% compounded annually. The tool is expected to provide annual (material) savings of $30,000 for two years and is to be depreciated by the MACRS three-year recovery period. The tool will require annualO&M costs in the amount of $5,000. The salvage value at the end of the two years is expected to be $8,000. Assuming a marginal tax rate of 25% and MARR of 15%, what is the net present worth of this project?

A special-purpose machine tool set would cost $20,000. The tool set will be financed by a $10,000 bank loan repayable in two equal annual installments at 10% compounded annually. The tool is expected to provide annual (material) savings of $30,000 for two years and is to be depreciated by the MACRS three-year recovery period. The tool will require annual O&M costs in the amount of $5,000. The salvage value at the end of the two years is expected to be $8,000. Assuming a marginal tax rate of 25% and MARR of 15%, what is the net present worth of this project? Click the icon to view the worksheet for your calculation. Click the icon to view the MACRS depreciation schedules. Click the icon to view the interest factors for discrete compounding when i = 10% per year. Click the icon to view the interest factors for discrete compounding when i = 15% per year. 5 The net present worth of the project is $ thousand. (Round to one decimal place.) i More Info X i More Info * More Info Single Payment Equal Payment Series _Class - 3 Yearn Depreciation rate 200% 33.33 44.45 14.81 7.41 Single Payment Compound Present Amount Worth Factor Factor (FIP, i, N) (P/F, I, N) 1.1000 0.9091 1.2100 0.8264 1.3310 0.7513 1.4641 0.6830 1.6105 0.6209 Equal Payment Series Sinking Present Fund Worth Factor Factor (A/F, I, N) (P/A, I, N) 1.0000 0.9091 0.4762 1.7355 0.3021 2.4869 0.2155 3.1699 0.1638 3.7908 Compound Amount Factor (F/A, I, N) 1.0000 2.1000 3.3100 4.6410 6.1051 Compound Amount Factor (F/P, I, N) 1.1500 1.3225 1.5209 1.7490 2.0114 Capital Recovery Factor (A/P, i, N) 1.1000 0.5762 0.4021 0.3155 0.2638 Present Worth Factor (P/F, I, N) 0.8696 0.7561 0.6575 0.5718 0.4972 Compound Amount Factor (F/A, I, N) 1.0000 2.1500 3.4725 4.9934 6.7424 OWN- Sinking Fund Factor (A/F, I, N) 1.0000 0.4651 0.2880 0.2003 0.1483 Present Worth Factor (P/A, I, N) 0.8696 1.6257 2.2832 2.8550 3.3522 Capital Recovery Factor (A/P, i, N) 1.1500 0.6151 0.4380 0.3503 0.2983 2.3131 3.7845 0.1142 1.7716 0.5645 0.2642 7.7156 0.4323 0.1296 0.2296 4.3553 8.7537 Print Done Print Done 10:05 PM Type here to search o pe 9 N - D 4/18/2020 W