Company X is planning on purchase a 3-D printer. The expected cost of this printer $75000, and it is expected to have a useful life of 6 year and an estimated salvage value of $3000.00

The printer expected to produce cash savings of $23,000 per in reduced labor costs and the cash operating costs to run this printer are estimated to be $5000 per year

Assuming company X is in the 34% tax bracket and has minimum desired rate of return of 12% on this investment

Determine the:

(a) payback period (b) APR (c) NPV

(a) payback period (b) APR (c) NPV

Equipment is purchased at a cost of $80,000. As a result, annual cash revenues are expected to increase by $45,000; annual cash expenses are expected to increase by $12,000 straight-line depreciation is used; the asset has a seven-year life; the salvage value is $10,000. Assume the company is in a 34% tax bracket. 1. Determine the accounting rate of return? (round to the nearest %) 2. Determine the payback period? 3. Determine the NPV assuming a minimum required rate of return of 8%? Problem 2 (Ignore taxes for this problem) Terra Networks is planning to buy injection molding machinery costing $180,000. This machinery's expected useful life is 5 years. They require a minimum rate of return of 8%, and have calculated the following data pertaining to the purchase and operation of this machinery: Year 1. 1 2 3 4 5 Determine Terra's payback period, accounting rate of return, and NPV for this investment? Company X is planning on purchasing a 3-D printer. The expected cost of this printer is $75,000, and it is expected to have a useful life of 6 years and an estimated salvage value of $3,000 The printer is expected to produce cash savings of $23,000 per year in reduced labor costs and the cash operating costs to run this printer are estimated to b Assuming Company X is in the 34% tax bracket and has a minimum desired rate of return of 12% on this investment. Determine the: 1. (a) payback period, (b) ARR, and (c) NPV (Ignoring taxes) 2. (a) payback period, (b) ARR, and (c) NPV (Assuming taxes). Chapter 16 Problems Problem 1 Expenses-Depreciation-taxes/equipment cost: Equipment cost/expenses-depreciation-taxes Equipment cost/expenses-depreciation-taxes Equipment cost-minimum required rate (45000-12000-10000-15300)/80000 80000/7700 7700*6.71 80000-51667 9.6% 10.3896103896 51667 $28,333.00 Problem 2 on of this machinery: Estimated Annual Cash Inflows $40,000 $50,000 $75,000 $105,000 $110,000 Estimated Annual Cash Outflows $8,000 $18,000 $22,000 $35,000 $50,000 Depreciation $28,000 $28,000 $28,000 $28,000 $28,000 e of $3,000 un this printer are estimated to be $5,000 per year Problem 3 0 1