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Kenny Inc. has recently introduced a new line of hoodies that protects its wearer against extreme cold temperature (up to -40 degrees Celsius) while still
Kenny Inc. has recently introduced a new line of hoodies that protects its wearer against extreme cold temperature (up to -40 degrees Celsius) while still being lightweight and stylish. The company has underestimated the appeal of these hoodies for consumers who do not live near the two poles, and as a result, the company has lost sales and must set up another production run for the year. These are examples of what type of inventory costs? Multiple Choice Deficiency costs. Scarcity costs. o Carrying costs o Shortage costs. Excess costs. The Wildcat Oil Company is trying to decide whether to lease or buy a new computer-assisted drilling system for its oil exploration business. Management has already determined that acquisition of the system has a positive NPV. The system costs $10.4 million and qualifies for a 35% CCA rate. The equipment will have a $985,000 salvage value in 5 years. Wildcat's tax rate is 40%, and the firm can borrow at 10.0%. Southtown Leasing Company has offered to lease the drilling equipment to Wildcat for payments of $2.25 million per year. Southtown's policy is to require its lessees to make payments at the start of the year. What is the NAL for Wildcat? (Enter the answer in dollars and not in millions of dollars. Do not round intermediate calculations. Round the final answer to 2 decimal places. Omit $ sign in your response.) NAL $ What is the maximum pre-tax lease payment that would be acceptable to the company? (Enter the answer in dollars and not in millions of dollars. Do not round intermediate calculations. Round the final answer to 2 decimal places. Omit $ sign in your response.) Maximum lease payment $
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