ity Hospital, a taxpaying entity, estimates that it can save $28,000 a year in cash operating costs for the next 10 years if it buys a special-purpose eye-testing machine at a cost of $110,000 No terminal disposal value is expected. City Hospital's required rate of return is 14%, Assume all cash flows ocor at year end except for i investment amounts. City Hospital uses straight-line depreciation. The income tax rate is 30% for all transactions that affect income taxes. Click the icon to view the Future Value of Annuity of $1 factors.) (Click the icon to view the Present Value of Annuity of $1 factors.) (Click the icon to view the Future Value of $1 factors.) (Click the icon to view the Present Value of $1 factors.) Read the reguirements. Requirement 1. Calculate the following for the special-purpose eye-testing machine: tvalue (NPR) (Round interim calculations and your final answers to the nearest whole dollar. Use a minus sign or parentheses for a negative net present value.) The net present value is 9449.05 b. Payback period (Round your answer to two decimal places.) The payback period is 4.80 years. Choose from any list or enter any number in the input fields and then continue to the next question. City Hospital, a taxpaying entity, estimates that it can save $28,000 a year in cash operating costs for the at a cost of $110,000. No terminal disposal Hospitail's required rate next 10 years if it buys a special-purpose eye-testing machine 1 value is expected City Hospital's required rate of return is 14% Assume all cash flows occur at year-end except for initial uses straight-line depreciation. The income tax rate is 30% for all transactions that affect income taxes. investment amounts. City Hospital (Click the icon to view the Future Value of Annuity of $1 factors.) (Click the ioon to view the Present Value of Annuity of $1 factors.) (Click the lcon to view the Future Value of $1 factors.) (Click the icon to view the Present Value of $1 factors.) Read the requirements 4.80 years. The payback period is Requirement 2. How would your computations in requirement 1 be affected if the special-purpose machine had a $10,000 terminal years? Assume depreciation deductions a words without further calculations. are based on the $110,000 purchase cost and zero terminal disposal value using the straight-line method. Answer briefly in NPV would increase because the disposal value Payback would not change because the disposal value Choose from any list or enter any number in the input fields and then continue to the next question. Save for Later Hospital, a taxpaying entity, estimates that it can save $28,000 a year in cash operating costs for the next 10 years if it buys a special-purpose eye-testing machi cost of S 110,000. No terminal disposal value is expected. City Hospital's required rate of return is 14%. Assume all cash flows o (Click the icon to view the Future Value of $1 factors.) (Click the icon to view the Present Value of $1 factors.) r at year-end except for initial estment amounts. City Hospital uses straight-line depreciation. The income tax rate is 30% for all transactions that affect income taxes. (Click the icon to view the Future Value of Annuity of $1 factors.) y of $1 factors.) does not affect average annual operating income. does not affect the net initial investment. results in a decrease in average annual operating income. results in a decrease to the net initial investment. ead the requirements The payback period is 4.80 years Requirement 2. How would your computations in requirement results in an increase in average annual operating income. years? Assume depreciation deductions are based on the $11 results in an increase in the total present value of cash inflows. ght-line method. Answer briefly in words without further calculations disposal value at the end of 10 results in an increase to the net initial investment NPV would increase because the disposal value Payback would not change because the disposal value Choose from any list or enter any number in the input fields and then continue to the next