Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

NPV. Grady Precision Measurement Tools has forocasted the following sales and costs for a new GPS system: annual sales of 46,000 units at $16 a

image text in transcribed
NPV. Grady Precision Measurement Tools has forocasted the following sales and costs for a new GPS system: annual sales of 46,000 units at $16 a unit, production costs at 39% of sales price, annual fixed costs for production at 5200,000 . The compary tax rate is 35%. What is the annual operating cash flow of the new GPS system? Should Grady Precision Measurement Tools add the GPS system to its set of products? The initial investment is $1,400,000 for manufacturing equipment, which will be depreclated over six years (straight line) and wil be sold at the end of five yoars for $380,000. The cost of capital is 12% What is the annual operating cath flow of the new GPS system? (Fround to the nearest dollar)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Small Business Finance And Valuation

Authors: Rick Nason, Dan Nordqvist

1st Edition

1952538122, 9781952538124

More Books

Students also viewed these Finance questions

Question

Did you offer hard data that is verifiable? [D]

Answered: 1 week ago