Answered step by step
Verified Expert Solution
Question
1 Approved Answer
complete all parts pls ! ty iv Oriole Corp. is considering purchasing one of two new processing machines. Either machine would make it possible for
complete all parts pls ! ty
iv Oriole Corp. is considering purchasing one of two new processing machines. Either machine would make it possible for the company to produce its products more efficiently than it is currently equipped to do. Estimates regarding each machine are provided below: Machine A Machine B $114.000 $267.700 10 years 10 years Original cost Estimated life Salvage value Estimated annual cash inflows Estimated annual cash outflows -0- -0 $30,300 $60,300 $7.400 $14,800 - Your answer is correct Calculate the net present value and profitability index of each machine. Assume an 8% discount rate. (Round present value factor calculations to 5 decimal places, eg. 1.25124 and the final answer to 2 decimal places eg. 589.71. Enter negative amounts using either a negative sign preceding the number eg.-45.35 or parentheses eg. (45.35).) Machine A Machine B Net pre value 39660 $ 37608.64 Profitability index 135 1.14 Which machine should be purchased? Oriole Corp, should purchase Machine A Your answer is partially correct. Oriole Corp. did some further research and found one other possible machine that would produce the same type of production efficiencies. The information regarding Machine C is below: Machine C $253,000 Original cost Estimated life Salvage value 10 years $30,300 $45,000 Estimated annual cash inflows Estimated annual cash outflows $10,000 Calculate the net present value and profitability index for Machine C. Use an 8% discount rate (Round present value factor calculations to 5 decimal places, eg, 1.25124 and the final answer to 2 decimal places eg. 589.71. Enter negative amounts using either a negative sign preceding the number e.g. -45.35 or parentheses es. (45.35)) Estimated life 10 years $30,300 Salvage value Estimated annual cash inflows Estimated annual cash outflows $45,000 $10,000 Calculate the net present value and profitability index for Machine C. Use an 8% discount rate. (Round present value factor calculations to 5 decimal places, eg. 1.25124 and the final answer to 2 decimal places eg. 589.71. Enter negative amounts using either a negative sign preceding the number 4.3. -45,35 or parentheses eg. (45.35)) Net present value $ Question 9 of 9 Save for Later (62) The parts of this question must be completed in order. This part will be available when you complete the part above. (63) The parts of this question must be completed in order. This part will be available when you complete the part above. (b4) The parts of this question must be completed in order. This part will be available when yourcomplete the part above. 1.5/5 E Attempts: 2 of 3 used Submit Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started