Factor Company is planning to add a new product to its line. To manufacture this product, the company needs to buy a new machine at a $503,000 cost with an expected four-year life and a $15,000 salvage value. All sales are for cash, and all costs are out-of-pocket, except for depreciation on the new machine. Additional information includes the following. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.)

Required: 1. Compute straight-line depreciation for each year of this new machines life. 2. Determine expected net income and net cash flow for each year of this machines life. 3. Compute this machines payback period, assuming that cash flows occur evenly throughout each year. 4. Compute this machines accounting rate of return, assuming that income is earned evenly throughout each year. 5. Compute the net present value for this machine using a discount rate of 7% and assuming that cash flows occur at each year-end. (Hint: Salvage value is a cash inflow at the end of the assets life.)

Factor Company is planning towed a new products to match the compared to buy a new machine 5503,000 cost wan cected four year and a 55000 Slage e Asses we can and costs are out of pocket except for depreciation on the new machine. Roolinfomation includes the following POEL VP Stand BV Si us propriate factor from the tables provided Compute this machine's accounting rate of return, assuming that income is earned evenly throughout each year, Accounting Rate of Return Choose Numerator Choose Denominator Accounting Rate of Retum = Accounting rate of return spectat les of triale Detta Overdrage Required tComoure atraghe deprecies for each year of 2 Determine pe net ctime and for the machines 3. Computer atack price taget for every throughout each year & Computers suces according that comes and evenly throughout the S.Compute the ne present value for medisce and sumang Set cash fous occur each year-end Mint Selvage le scafowate end of the Compute this machine's payback period, assuming that cash flows occur evenly throughout each year. Payback Period Choose Numerator Choose Denominator Payback Period Payback period Complete this question by ensuring yowawers in the tabs below Competition for each of Compute the net present value for this machine using a discount rate of 7% and assuming that cash flows occur at each year-end. (Hint: Salvage value is a cash inflow at the end of the asset's life.) Do not round intermediate calculations. Amounts to be deducted should be indicated by a minus sign.) Chart Values are based on: Determine expected net income and net cash flow for each year of this machine's life. Expected Net Income Revenues Select Chart Amount X PV Factor Cash Flow Annual cash flow Residual value Present Value 0 Expenses Net present value Expected Net Cash Flow 0