not 28

28. Creighton Industries is considering the purchase of a new strapping machine, which will cost $150,000. plus an additional $10.500 to ship and install. The new machine will have a 5-year useful life and will be depreciated to zero using the straight-line method. The machine is expected to generate new sales of $45.000 per year and is expected to save $16,000 in labor and electrical expenses over the next 5 years. The machine is expected to have a salvage value of $20.000. Creighton's income tax rate is 35%. Creighton uses a 125% discount rate for capital budgeting purposes. What is the machine's NPV? O A $27.894 O B. $22,153 O c. $25,062 OD. $29,888 29. HomeCraft makes wooden play sets. The company pays annual rent of $400.000 per year and pays administrative salaries totaling $150,000 per year. Each play set requires $400 of wood, ten hours of labor at $70 per hour and variable overhead costs of $100. Fixed advertising expenses equal $100.000 per year. Each play set sells for $3,200. What is HomeCraft's break-even output level? O A. 325 play sets OB. 297 play sets O c. 340 play sets OD. 258 play sets 30, Quad City Manufacturing, Inc. reported the following items: Sales = $6,000,000: Variable costs of Production = $1,500,000 Variable Selling and Administrative Expenses = $550,000: Fixed Costs = $1,350,000; EBIT - $2,600,000; and the Marginal Tax Rate = 35%. Quad City's break-even point in sales dollars is O A. $2,438,750 O B. $2,785,000 OC. $2,197,500 OD. $2,050,633 31. Variable costs include all of the following EXCEPT O A. direct labor O B. sales commissions. O C. property taxes OD. annual rent 32. Siskiyou, Inc. has total current assets of $1,200,000; total current liabilities of $500,000; long-term assets of $800,000 and long-term debt of $600,000. How much is the firm's total equity? O A. $800,000 O B. $2,000,000 O C. $900,000 OD. $1,200,000