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Please answer both A and B while showing your work please: 9. Barker Production Company is considering the purchase of a flexible manufacturing system. The
Please answer both A and B while showing your work please:
9. Barker Production Company is considering the purchase of a flexible manufacturing system. The annual after-tax cash benefits/savings associated with the system are: Increased quality Decrease in operating costs Increase in on-time deliveries 100,000 62,500 12,500 The system will cost $750,000 and wll last ten years. At the end of its useful life, the system can be sold for $13,000. What is the present value of this investment? The company's cost of capital is 12%. Required: A hat is the payback period for the flexible manufacturing system? B. What is the NPV for the flexible manufacturing system? Round to the nearest dollarStep by Step Solution
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