Answered step by step
Verified Expert Solution
Question
1 Approved Answer
please answer asap!!! The Elberta Fruit Farm of Ontario has always hired transient workers to pick its annual cherry crop. Janessa. Wright, the farm manager.
please answer asap!!!
The Elberta Fruit Farm of Ontario has always hired transient workers to pick its annual cherry crop. Janessa. Wright, the farm manager. just recelved information on a cherry picking machine that is being purchased by many fruit farms. The machine is a motorized device that shakes the cherry tree, causing the cherries to fall onto plastic tarps that funnel the cherries into bins. Ms. Wright has gathered the following information to decide whether a cherry picker would be a profitable investment for the Elberta Fruit Farm: a. Currently, the farm is paying an average of $230,000 per year to transient workers to pick the cherries. b. The cherry picker would cost $670,000. It would be depreclated using the straight-line method and it would have no salvage value at the end of its 10 -year useful life. c. Annual out-of-pocket costs associated with the cherry picker would be: cost of an operator and an assistant, $93,000; insurance. $2,000; fuel, $10,000; and a maintenance contract, $13,000. Click here to view and to determine the approprlate discount factor using tables. XHITT 14B-1 FXIIBIT 14152 Determine the annual savings in cash operating costs that would be realized if the cherry picker were purchased. Compute the simple rate of return expected from the cherry picker. (Round your answer to 2 decimal places. Compute the payback period on the cherry picker. (Round your answer to 2 decimal places.) Compute the internal rate of return promised by the cherry picker. (Round your answer to the nearest whole percent.) Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started