Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Ataxia Fitness Center is considering an investment in some additional weight training equipment. The equipment has an estimated useful life of 6 years with no

image text in transcribed
image text in transcribed
image text in transcribed
Ataxia Fitness Center is considering an investment in some additional weight training equipment. The equipment has an estimated useful life of 6 years with no salvage value at the end of the 6 years. Ataxia's internal rate of return on this equipment is 4%. Ataxia's discount rate is also 4%. The payback period on this equipment is closest to (ignore income taxes): Click here to view Exhibit 138-1 and Exhibit 138-2, to determine the appropriate discount factors) using the tables provided Multiple Choice 6 years O 524yers 524 years 6.34 years 3.00 years he management of Byrge Corporation is investigating buying a small used aircraft to use in making airborne inspections of its above-ground pipelines. The aircraft would have a useful life of 6 years. The company uses a discourt rate of 20% in its capital budgeting. The net present value of the investment, excluding the intangible benefits, ls -$474,840 (Ignore income taxes.) Click here to view Exhibit 138-1 and Exhibit 138-2, to determine the appropriate discount factorls) using the tables provided How large would the annual intangible beneft have to be to make the investment in the aircraft financially attractive? (Round your intermediate calculations and final answer to the nearest whole dollar amount.) Multiple Choice $79140 $474,840 $142,766 $94,968 The management of Osborn Corporation is investigating an investment in equipment that would have a useful life of 7 years The company uses a discount rate of 12% in its capital budgeting. The net present value of the investment, excluding the annual cash inflow, is-$403,814. To the nearest whole dollar how large would the annual cash inflow have to be to make the investment in the equipment financially attractive? (Ignore income taxes) Click here to view Exhibit 138.1 and Exhibrt 138.2, to determine the appropriate discount factorts) using the tables provided Multiple Choice $88,478 $403,814 $48,458 $57688

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

EPA Should Improve Timeliness For Resolving Audits Under Appeal

Authors: U.S. Environmental Protection Agency

1st Edition

1500105783, 978-1500105785

More Books

Students also viewed these Accounting questions