Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

(Ignore income taxes in this problem) Benz Company is considering the purchase of a machine that costs $100,000 has, a useful life of 18years, and

image text in transcribed
(Ignore income taxes in this problem) Benz Company is considering the purchase of a machine that costs $100,000 has, a useful life of 18years, and no salvge value. The company's discount rate is 12%. If the machine's net present value is $5,850. then the annual cash inflows associated with the machine must be (round to the nearst whole dollar): $42.413 $14,600 $13,760 It is impossible to determine from the data given (Ignore income taxes in this problem.) The Cage Company purchased a machine which will be depreciated by the straight-line method over its estimated 6 year life. The machine will have no salvage value. It will generate cash inflows of $7.000 each year over the next 6 years. Gage Company's required rate of return is 14%. If the net present value of this investment is $12.016. the purchase price of the machine was: $ 30,016 $ I5.207 $ 17,916 $ 18,000 A project requires an initial investment of $ 60.000 and has a project profitability index of 0.329. The present value of the future cash inflows from this investment is: $ 579.740 $ 45,147 $ 60,000 Cannot be determined with available data

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Knowledge Audit A Complete Guide

Authors: Gerardus Blokdyk

2020 Edition

0655912835, 978-0655912835

More Books

Students also viewed these Accounting questions

Question

1. Describe the types of power that effective leaders employ

Answered: 1 week ago