E3-45,47,49

45

47

49

Byron Corp. is considering the purchase of a new piece of equipment. The cost savings from the equipment would result in an annual increase in cash flow of $110,000. The equipment will have an initial cost of $498,000 and have a 5-year life. The salvage value of the equipment is estimated to be $77,000. If the hurdle rate is 10%, what is the approximate net present value? Ignore income taxes. (Future Value of $1, Present Value of $1, Future Value Annuity of $1, Present Value Annuity of $1.) (Use appropriate factor from the PV tables. Round your final answer to the nearest dollar amount.) Multiple Choice Positive $498.000 Zero Positive $77,000 Negative $33,203 Wilson Corp. is considering the purchase of a new piece of equipment. The cost savings from the equipment would result in an annual increase in net income after tax of $57,000. The equipment will have an initial cost of $635,000 and have an 8-year life. The salvage value of the equipment is estimated to be $131,000. If the hurdle rate is 12%, what is the approximate net present value? (Future Value of $1, Present Value of $1, Future Value Annuity of $1, Present Value Annuity of $1.) (Use appropriate factor from the PV tables. Round your final answer to the nearest dollar amount.) Multiple Choice O $504,000 $14,023 $131,000 o Less than zero Belmont Corp. is considering the purchase of a new piece of equipment. The cost savings from the equipment would result in an annual increase in net income after tax of $295,000. The equipment will have an initial cost of $1,056,000 and have an 8-year life. If there is no salvage value of the equipment, what is the payback period? Multiple Choice 2.23 years O 2.47 years o 3.58 years O 8.00 years