Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

please answer in boxes Heels, a shoe manufacturer, is evaluating the costs and benefits of new equipment that would custom fit each pair of athletic

please answer in boxes image text in transcribed
image text in transcribed
Heels, a shoe manufacturer, is evaluating the costs and benefits of new equipment that would custom fit each pair of athletic shoes. The customer would have his or her foot scanned by digital computer equipment; this information would be used to cut the raw materials to provide the customer a perfect fit. The new equipment costs $101,000 and is expected to generate an additional $40,000 in cash flows for five years. A bank will make a $101,000 loan to the company at a 12% interest rate for this equipment's purchase. Compute the recovery time for both the payback period and break-even time. (PV of $1. FV of $1. PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.) Complete this question by entering your answers in the tabs below. Payback Period Break even time Compute the recovery time for the payback period. Payback Period Choose Denominator: Choose Numerator: Payback Period = Payback period 0 Payback Period Break even time > Complete this question by entering your answers in the tabs below. Payback Period Break even time Compute the recovery time for the break-even time. (Cumulative net cash outflows must be entered with a minus sign. Rc your Break-even time answer to 1 decimal place.) Chart Values are Based on: Year Cash Inflow (Outflow) * PV Factor Present Value Cumulative Present Value of Inflow (Outflow) $ (101,000) X 1.0000 = $(101,000) $ (101,000)

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

Word Search Puzzle Book For Auditing Clerk

Authors: Lx Antu

1st Edition

B09KN7YDD6, 979-8757688466

More Books

Students also viewed these Accounting questions