no work needed just solutions

Billingham Packaging is considering expanding its production capacity by purchasing a new machine, the XC-750. The cost of the XC-750 - $2.75 million. Unfortunately, installing this machine will take several months and will partially disrupt production. The firm has just completed a 550,000 frasbility study to analyze the decision to buy the XC-750, resulting in the following estimate Marketing Once the XC-750 is operating next year, the extra capacity is expected to generate $10 milion per year in additional sales, which will continue for the ten year ife of the machine Operations. The dioruption caused by the installation will decrease sale by $5 million this year. As with Slinghams existing products, the cost of good for the producto produced by the XC-750 expected to be 70% of their sale price. The increased production will also require increased inventory on hand of 51 milion during the life of the project. The increased production will require additional inventory of $1 milion to be added in year and depleted in year 10 . Muman Resources. The expansion will require additional sales and administrative personnel at a cost of $2 milion per year. Accounting The XC 750 will be deprecated in the straight-line method in year 1990 Receivables expected to be 18% of revenues and pay to be 10% of the cost of goods sold Bilingham?s marginal corporate tax rate is 15% Determine the incremental coming from the purchase of the XC-750 Determine the free can now from the purchase of the XC-150 c. If the appropriate cost of capits for the expansion is 100% compute the NPV of the purchase d. While the expected new nates will be $10 million per year from the expansion estimates range from 58 million to $12 milion What is the NPV in the worst in the best case? e. What is the break-even level of new from the expansion? What is the break-even level for the cost of goods sold ngham could noload purchase the XC 900, which offers even gremer capacity. The cost of the XC 600 54 milion. The extra capacity would not be in the first two years of operation, but would now for nositional in your 3:10. What sevel of additional salon (bove the 510 Million pected for ile XC-750 per year in the years would justly purchase the large machine? a. Determine the incremental coming from the purchase of the XC-750 Calculate the incremental camingu from the purchase of the XC-780 below (round to the nearest color) Incremental Earnings Year Sales Revenues Cott of Goods Sod $ S. G, and A Expenses $ Depreciation 5 EBIT $ To al 15 $ Univered Net Income