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please clearly label and show work so i can learn! will thumbs up! a. what is the total 'undiscounted' cash savings that this machine will
please clearly label and show work so i can learn! will thumbs up!
The management of Kanban Company is considering the purchase of a $54,000 machine that would reduce operating costs by $12,000 per year. At the end of the machine's six-year useful life, it will have zero salvage value. The company's required rate of return is 9%. The management of Kanban Company is considering the purchase of a $54,000 machine that would reduce operating costs by $12,000 per year. At the end of the machine's six-year useful life, it will have zero salvage value. The company's required rate of return is 9% a. what is the total 'undiscounted' cash savings that this machine will provide over its useful life?
b.what is the total 'discounted' (use time value of money) cash savings that this machine will provide over its useful life?
c. what is the bet present value of this investment in the machine?
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