Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Part 1 of 4 Homework Score: 0 of 1 Samson Industries is deciding whether to automate one phase of its production process. The manufacturing equipment

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
Part 1 of 4 Homework Score: 0 of 1 Samson Industries is deciding whether to automate one phase of its production process. The manufacturing equipment has a six-year life and will cost $900,000. Projected net cash inflows are as follows: (Click the icon to view the projected net cash inflows.) (Click the icon to view the present value table.) (Click the icon to view the present value annuity table.) (Click the icon to view the future value table.) (Click the icon to view the future value annuity table.) Read the requirements Requirement 1. Compute this project's NPV using Samson Industries' 14% hurdle rate. Should Samson Industries invest in the equipment? Why or why not? Begin by computing the project's NPV (net present value). (Round your answer to the nearest whole dollar. Use parentheses or a minus sign for negative net present values.) Net present value Enter any number in the edit fields and then click Check Answer. Get More Help Clear All Check Answer the icon to view the projected net cash inflows.) (Click the icon to view the (Click the icon to view the Read the requirements. - Data Table - X value ar Slue ann Year 1 $265,000 amson In Year 2 Requirement 1. Compute this equipment? Why or why not? Begin by computing the project ninus sign for negative net pre $254,000 $227,000 Year 3 le dollar Year 4 Net present value Year 5 $210,000 $200,000 $175,000 Year 6 Print Done Pan OT 4 Score: 0 of 1 Reference - Sams six-ye Read Reqy equip Begir minus Present Value of $1 Periods 1% 2% 3% 4% 5% 6% 8% 10% 12% 14% 16% 18% 20 Period 1 0.990 0.980 0.971 0.962 0.952 0.943 0.926 0.909 0.893 0.877 0.862 0.847 0.83 Period 2 0.980 0.961 0.943 0.925 0.907 0.890 0.857 0.826 0.797 0.769 0.743 0.718 0.69. Period 3 0.971 0.942 0.915 0.8890.864 0.840 0.794 0.751 0.712 0.675 0.641 0.609 0.57! Period 4 0.961 0.924 0.888 0.855 0.823 0.792 0.735 0.683 0.636 0.592 0.552 0.516 0.48 Period 5 0.951 0.906 0.863 0.822 0.784 0.747 0.681 0.621 0.567 0.519 0.476 0.437 0.40 Period 6 0.942 0.888 0.837 0.790 0.746 0.705 0.630 0.564 0.507 0.456 0.410 0.370 0.33 Period 7 0.933 0.871 0.813 0.760 0.711 0.665 0.583 0.513 0.452 0.400 0.354 0.314 0.27 Period 8 0.923 0.853 0.789 0.731 0.677 0.627 0.540 0.467 0.404 0.351 0.305 0.268 0.23 Period 9 0.914 0.837 0.766 0.703 0.645 0.592 0.500 0.424 0.361 0.308 0.263 0.225 0.19 Period 100.905 0.820 0.744 0.676 0.614 0.558 0.463 0.386 0.322 0.270 0.227 0.191 | 0.16 Period 110.896 0.804 0.722 0.650 0.585 0.527 0.429 0.350 0.287 0.237 0.195 0.162 0.13 Period 120.887 0.788 0.701 0.625 0.557 0.497 0.397 0.319 0.257 0.208 0.1680.137 0.113 Period 13 0.879 0.773 0.681 0.601 0.530 0.469 0.368 0.290 0.229 0.182 0.145 0.116 0.09 Period 14 0.870 0.758 0.661 0.577 0.505 0.442 0.340 0.263 0.205 0.160 0.125 0.099 0.071 Period 15 0.861 0.743 0.642 0.555 0.481 0.417 0.315 0.239 0.183 0.140 0.108 0.084 0.06 Period 20 0.820 0.673 0.554 0.456 0.377 0.312 0.215 0.149 0.104 0.073 0.051 0.037 0.02 Period 25 0.780 0.610 0.478 0.375 0.295 0.233 0.146 0.092 0.059 0.038 0.024 0.0160.01 Period 30 0.742 0.552 0.412 0.308 0.231 0.174 0.099 0.057 0.033 0.020 0.012 0.007 0.00 Period 40 0.672 0.453 0.307 0.208 0.142 0.097 0.046 0.022 0.011 0.005 0.003 0.001 0.00 Net Enter Print Done Question 5, E12-29A (si... HW Score: 35.95%, 4.31 of 12 points Reference - X Sarl six- Future Value of $1 Red Periods Period 1 Period 2 Period 3 Period 4 Period 5 Period 6 Period 7 Period 8 Period 9 Period 10 1% 1.010 1.020 1.030 1.041 1.051 2% 1.020 1.040 1.061 1.082 1.104 3% 1.030 1.061 1.093 1.126 1.159 4% 1.040 1.082 1.125 1.170 1.217 Red equ he Beg min 1.062 1.072 1.083 1.094 1.105 1.126 1.149 1.172 1.195 1.219 1.194 1.230 1.267 1.305 1.344 1.265 1.316 1.369 1.423 1.480 bra 5% 6% 8% 10% 12% 14% 16% 18% 1.050 1.060 1.080 1.100 1.120 1.140 1.160 1.180 1.103 1.124 1.166 1.210 1.254 1.300 1.346 1.392 1.158 1.191 1.260 1.331 1.405 1.482 1.561 1.643 1.216 1.262 1.360 1.464 1.574 1.689 1.811 1.939 1.276 1.338 1.469 1.611 1.762 1.925 2.100 2.288 1.340 1.419 1.587 1.772 1.974 2.195 2.436 2.700 1.407 1.504 1.714 1.949 2.211 2.502 2.826 3.185 1.477 1.594 1.851 2.144 2.476 2.853 3.278 3.759 1.551 1.689 1.999 2.358 2.773 3.252 3.803 4.435 1.629 1.791 2.159 2.594 3.106 3.707 4.411 5.234 1.710 1.898 2.332 2.853 3.479 4.226 5.117 6.176 1.796 2.012 2.518 3.138 3.896 4.818 5.936 7.288 1.886 2.133 2.720 3.452 4.363 5.492 6.886 8.599 1.980 2.261 2.937 3.797 4.887 6.261 7.988 10.147 2.079 2.397 3.172 4,177 5.474 7.138 9.266 11.974 2.653 3.207 4.661 6.727 9.646 13.743 19.461 27.393 3.386 4.292 6.848 10.835 17.000 26.462 40.874 62.669 4.322 5.743 10.063 17.449 29.960 50.950 85.850 143.371 7.040 10.286 21.725 45.259 93.051 188.884 378.721750,378 Net Period 11 Period 12 Period 13 Period 14 Period 15 1.116 1.127 1.138 1.149 1.161 1.243 1.268 1.294 1.319 1.346 1.384 1.426 1.469 1.513 1.558 1.539 1.601 1.665 1.732 1.801 Period 20 Period 25 Period 30 Period 40 1.220 1.282 1.348 1.489 1.486 1.641 1.811 2.208 1.806 2.094 2.427 3.262 2.191 2.666 3.243 4.801 Print Done Present Value of Annuity of $1 Periods 1% 2% 3% 4% 5% 6% 8% 10% 12% 14% 16% 18% Period 1 20% 0.990 0.980 0.971 0.962 0.952 0.943 0.926 0.909 0.893 0.877 0.862 0.847 Period 2 0.833 1.970 1.942 1.913 1.886 1.859 1.833 1.783 1.736 1.6901.647 1.605 1.566 1.528 Period 3 2.941 2.884 2.829 2.775 2.723 2.673 2.577 2.487 2.402 2.322 2.246 2.174 2.106 Period 4 3.902 3.808 3.7173.630 3.546 3.465 3.312 3.170 3.037 2.914 2.798 2.690 2.589 Period 5 4.853 4.713 4.580 4.452 4.329 4.2123.993 3.791 3.605 3.433 3.274 3.127 2.991 Period 6 5.795 5.601 5.417 5.242 5.076 4.917 4.623 4.355 4.111 3.889 3.685 3.498 3.326 Period 7 6.728 6.472 6.230 6.0025.786 5.5825.206 4.868 4.564 4.288 4.039 3.812 3.605 Period 8 7.652 7.325 7.020 6.733 6.463 6.210 5.747 5.335 4.968 4.639 4.344 4.078 3.837 Period 9 8.566 8.162 7.786 7.435 7.108 6.8026.247 5.759 5.328 4.946 4.607 4.303 4.031 Period 10 9.471 8.983 8.530 8.111 7.722 7.360 6.710 6.145 5.6505.216 4.833 4.494 4.192 Period 1110.368 9.787 9.253 8.760 8.306 7.887 7.139 6.495 5.938 5.453 5.029 4.656 4.327 Period 12 11.255 10.575 9.954 9.3858.863 8.384 7.536 6.814 6.194 5.660 5.197 4.793 4.439 Period 13 12.134 11.348 10.635 9.986 9.3948.853 7.904 7.103 6.424 5.842 5.3424.910 4.533 Period 14 13.004 12.106 11.296 10.563 9.899 9.295 8.244 7.3676.628 6.002 5.468 5.008 4.611 Period 15 13.865 12.849 11.938 11.118 10.380 9.712 8.559 7.606 6.811 6.142 5.575 5.092 4.675 4.870 Period 2018.046 16.351 14.877 13.590 12.462 11.470 9.818 8.514 7.469 6.623 5.929 5.353 Period 25 22.023 19.523 17.413 15.622 14.094 12.783 10.675 9.077 7.843 6.873 6.097 5.467 4.948 Period 30 25.808 22.396 19.600 17.292 15.372 13.765 11.258 9.427 8.055 7.003 6.177 5.517 4.979 Period 40 32.835 27.355 23.115 19.793 17.159 15.046 11.925 9.779 8.244 7.105 6.233 5.548 4.997 Print Done Future Value of Annuity of $1 Periods 1% 2% 3% 4% 5% 6% 8% 10% 12% 14% Period 1 16% 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 Period 2 2.010 2.020 2.030 2.040 2.050 2.060 2.080 2.100 2.120 2.140 2. 160 Period 3 3.030 3.060 3.091 3.122 3.153 3.184 3.246 3.310 3.374 3.440 3.506 Period 4 4.060 4.122 4.184 4.246 4.310 4.375 4.506 4.641 4.779 4.921 5.066 Period 5 5.101 5.204 5.309 5.416 5.526 5.637 5.867 6.105 6.353 6.610 6.877 Period 6 6.152 6.308 6.468 6.633 6.8026.975 7.336 7.716 8.115 8.536 8.977 Period 7 7.214 7.434 7.662 7.898 8.142 8.394 8.923 9.487 10.089 10.730 11.414 Period 8 8.286 8.583 8.892 9.214 9.549 9.897 10.637 11.436 12.300 13.233 14.240 Period 9 9.369 9.755 10.159 10.583 11.027 11.491 | 12.488 13.579 14.776 16.085 17.519 Period 10 10.462 10.950 11.464 12.006 12.578 13.181 14.48715.937 17.549 19.337 21.321 Period 11 11.567 12.169 12.808 13.486 14.207 14.97216.645 18.531 20.655 23.045 25.733 2 Period 12 12.683 13.412 14.192 15.026 15.917 16.870 18.977 21.384 24.133 27.271 30.850 3 Period 13 | 13.809 14.680 15.618 16.627 17.713 18.882 21.495 24.523 28.029 32.089 36.786 Period 14 14.947 15.974 17.086 18.292 19.599 21.015 24.215 27.975 32.393 37.581 43.672 Period 15 16.097 17.29318.599 20.024 21.579 23.276 27.152 31.772 37.280 43.842 51.660 Period 20 22.019 | 24.297 26.870 29.778 33.066 36.786 45.762 57.275 72.052 91.025 115.380 14 Period 25 28.243 32.03036.459 41.646 47.727 54.865 73.106 98.347 133.1934 181.871 249.214 3 530.312 7: Period 30 34.785 40.568 47.575 56.085 66.43979.058 113.283 164.494 241.333 356.787 Period 40 48.886 60.402 75.401 95.026 120.800 154.762 259.057 442.593 767.091 1,342.025 2,360.757 4.1 - emchAN Print Done

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

Fundamental Accounting Principles

Authors: John Wild, Ken Shaw, Barbara Chiappett

23rd edition

1259536351, 978-1259536359

Students also viewed these Accounting questions