Answered step by step
Verified Expert Solution
Question
1 Approved Answer
i dont see where i can find the discounted NPV i only need requirement 2 answered and then im good Bevil Industries is deciding whether
i dont see where i can find the discounted NPV
i only need requirement 2 answered and then im good
Bevil Industries is deciding whether to automate one phase of its production process. The manufacturing equipment has a six-ye life and will cost $915,000. Projected net cash inflows are as follows: (Click the icon to view the projected net cash inflows.) (Click the icon to view the present value table.) (Click the icon to view the future value table.) (Click the icon to view the present value annuity table.) Read the requirements. (Click the icon to view the future value annuity table) Bevil Industries invest in the equipment because its NPV is negative Requirement 2. Bevil Industries could refurbish the equipment at the end of six years for $106,000. The refurbished equipment could be used one more year, providing $75,000 of net cash inflows in Year 7 . In addition, the refurbished equipment would have a $55,000 residual value at the end of Year 7 Should Bevil Industries invest in the equipment and refurbish it after six years? Why or why not? (Hint In addition to your answer to Requirement 1, discount the additional cash outflow and inflows back to the present value.) Calculate the additional NPV provided from the refurbishment. (Round your answer to the nearest whole dollar. Use parentheses or a minus sign for negative net present values.) Additional NPV provided from refurbishment Data table Requirement 2. Bevil Industrios. could refurbieh the equipment at the end of six years for 3105.000. The refurbished equipment could be used cse more year, providing $75.000 of net cash inflows in Year 7 . In addition, the refurbished equipment would have a 55.5,000 residual value at the end of Year 7 . Should Bevil industrins invest in the equipment and refurbish it after six years? Why or why not? (Hint fn addition to your answer to Pequiremont 1, discount the additional cath outliow and infiows back to the present valie.) Additional NPV provided from refurbishenent Bevil Industries is deciding whether to automate one phase of its production process. The manufacturing equipment has a six-ye life and will cost $915,000. Projected net cash inflows are as follows: (Click the icon to view the projected net cash inflows.) (Click the icon to view the present value table.) (Click the icon to view the future value table.) (Click the icon to view the present value annuity table.) Read the requirements. (Click the icon to view the future value annuity table) Bevil Industries invest in the equipment because its NPV is negative Requirement 2. Bevil Industries could refurbish the equipment at the end of six years for $106,000. The refurbished equipment could be used one more year, providing $75,000 of net cash inflows in Year 7 . In addition, the refurbished equipment would have a $55,000 residual value at the end of Year 7 Should Bevil Industries invest in the equipment and refurbish it after six years? Why or why not? (Hint In addition to your answer to Requirement 1, discount the additional cash outflow and inflows back to the present value.) Calculate the additional NPV provided from the refurbishment. (Round your answer to the nearest whole dollar. Use parentheses or a minus sign for negative net present values.) Additional NPV provided from refurbishment Data table Requirement 2. Bevil Industrios. could refurbieh the equipment at the end of six years for 3105.000. The refurbished equipment could be used cse more year, providing $75.000 of net cash inflows in Year 7 . In addition, the refurbished equipment would have a 55.5,000 residual value at the end of Year 7 . Should Bevil industrins invest in the equipment and refurbish it after six years? Why or why not? (Hint fn addition to your answer to Pequiremont 1, discount the additional cath outliow and infiows back to the present valie.) Additional NPV provided from refurbishenent 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