Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

BAK Corp. is considering purchasing one of two new diagnostic machines. Either machine would make it possible for the company to bid on jobs that

BAK Corp. is considering purchasing one of two new diagnostic machines. Either machine would make it possible for the company to bid on jobs that it currently isn't equipped to do. Estimates regarding each machine are provided below. Original cost Estimated life Salvage value Estimated annual cash inflows Estimated annu cash outflows Click here to view the factor table. Machine A $76,700 8 years 0 $20,200 $5,040 Machine B $183,000 8 years 0 $40,500 $9,870 Calculate the net present value and profitability index of each machine. Assume a 9% discount rte. (If the net present value is negative, use either a negative sign preceding the number eg -45 or parentheses eg (45). Round answer for present value to 0 decimal places, e.g. 125 and profitability index to 2 decimal places, e.g. 10.50. For calculation purposes, use 5 decimal places as displayed in the factor table provided.)
image text in transcribed
image text in transcribed
BAK Corp. is considering purchasing one of two new diagnostic machines. Either machine would make it possible for the company to bid on jobs that it currently isn't equipped to do. Estimates regarding each machine are provided below. cickhere to view the factor table Calculate the net present value and profitability index of each machine. Assume a 95 discount rate. (IIf the net present volue is negotive. use elther a negative sign precedirs the number es -45 or porentheses es (45). Round answer for present value to o decimot ploces es. 125 ond profitability index to 2 decimal places, es. 10.50 . For calculotion purposes, use 5 decimal placer as displayed in the factor table provided) Calculate the net present value and profitability index of each machine. Assume a 9% discount rate, of the net present value is negative. use either a negathe sign preceding the number es 45 or parentheses ea (45). Round answer for present value to 0 decimal ploces, es. 125 and profitability index to 2 decimal ploces, es 10.50. For calculation purposes, use 5 decimol ploces as dlsplayd in the factor toble providedt) BAK Corp. is considering purchasing one of two new diagnostic machines. Either machine would make it possible for the company to bid on jobs that it currently isn't equipped to do. Estimates regarding each machine are provided below. cickhere to view the factor table Calculate the net present value and profitability index of each machine. Assume a 95 discount rate. (IIf the net present volue is negotive. use elther a negative sign precedirs the number es -45 or porentheses es (45). Round answer for present value to o decimot ploces es. 125 ond profitability index to 2 decimal places, es. 10.50 . For calculotion purposes, use 5 decimal placer as displayed in the factor table provided) Calculate the net present value and profitability index of each machine. Assume a 9% discount rate, of the net present value is negative. use either a negathe sign preceding the number es 45 or parentheses ea (45). Round answer for present value to 0 decimal ploces, es. 125 and profitability index to 2 decimal ploces, es 10.50. For calculation purposes, use 5 decimol ploces as dlsplayd in the factor toble providedt)

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

Step: 3

blur-text-image

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

Auditing Fundamentals

Authors: Marlene Davies, John Aston

1st Edition

0273711733, 978-0273711735

More Books

Students also viewed these Accounting questions

Question

Why are expenses related to tax-exempt income disallowed?

Answered: 1 week ago

Question

What is Right of Labour law in Bangladesh ? Discuss in detail

Answered: 1 week ago

Question

3. Identify the methods used within each of the three approaches.

Answered: 1 week ago

Question

b. Where did they come from?

Answered: 1 week ago