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NPV. 100% Upvote. Relaxation Spa Company offers various services, such as facials, laser hair removal and microdermabrasion. Currently, the company is considering purchasing the following
NPV. 100% Upvote.
Relaxation Spa Company offers various services, such as facials, laser hair removal and microdermabrasion. Currently, the company is considering purchasing the following spa equipment: Laser Hair Removal Machines Microdermabrasion Machines Facial Oxygen Units Cost per Machine $60,230 $31,340 $24,2101 Annual Cash Inflow $122,400 $201,000 $40,940 Annual Cash Outflow $88,800 $185,500 $20,090 Required Rate of Return 6% 11% 4% Useful Life 6 years 3 years 5 years Salvage Value $220 $450 $9201 Assume that each equipment's annual cash flow will occur for the period equal to its useful life. Do not enter dollar signs or commas in the input boxes. Use the present values tables in the textbook appendix. Use the negative sign for negative values. Round your answers to the nearest whole number. a) Determine the NPV of each piece of equipment. Laser Hair Removal Machine: $ Microdermabrasion Machine: $ Facial Oxygen Unit: $ b) For each piece of equipment, determine the maximum acceptable price using the NPV method. b) For each piece of equipment, determine the maximum acceptable price using the NPV method. Laser Hair Removal Machine: $ Microdermabrasion Machine: $ Facial Oxygen Unit: $ C) In what year will the initial investment be recovered? Use the cumulative payback method. Laser Hair Removal Machine: Year Microdermabrasion Machine: Year Facial Oxygen Unit: YearStep by Step Solution
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