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Capra Laundry is investigating the purchase of a new washing machine. This machine would provide an annual operating cost savings of $4,000 for each of
Capra Laundry is investigating the purchase of a new washing machine. This machine would provide an annual operating cost savings of $4,000 for each of the next four years. In addition, this new machine would speed up the washing process that would result in servicing 1,500 new customer visits each year. The company earns a contribution margin of $0.90 on each customer visit. The purchase price of this machine is $13,450, and it will have a four-year useful life. Capra's discount rate is 14%. (Ignore income taxes in this problem.) What is the total annual cash inflow from this machine for capital budgeting purposes? O $3,650. $4,750. O $5,000. $5,350
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